UK PM May announces she will seek Brexit extension
The PM will ask for an additional three months from the EU to negotiate a Brexit deal through the House of Commons.
In a press conference staged today, UK Prime Minister Theresa May has announced her intention to request an extension to the March 29 Brexit deadline. The PM will ask for an additional three months from the EU to negotiate a Brexit deal through the House of Commons.
The move was widely expected, but the shortness of the requested extension has seemingly surprised market participants. Though the Pound has recently rallied on the basis that an extension of the deadline would materialize, price action suggests traders were hoping for one that was longer in duration.
The anxiety have been compounded by news released prior to PM May’s press conference, that reported President of the European Council, Donald Tusk, believed the EU ought to only grant an extension to the UK on the condition the UK Parliament first pass PM May’s Brexit deal – a presently unlikely proposition.
As a consequence of the overnight developments, the Pound has tumbled below the 1.31 handle, and 10 Year UK Gilts have dipped to challenge multi-year lows, as traders lower their bets that the Bank of England will have the free-air to hike interest rates in the near-future.
This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.
Live prices on most popular markets