Yesterday, Parliament returned to session following its Summer recess, and MPs have voted to take control of the legislative agenda from the government.
First, this is to try and pass a law obliging Prime Minister Boris Johnson to request a second extension to Article 50, the UK’s Brexit timetable, to prevent us exiting the EU without a deal on October 31st. Second, it’s because Mr. Johnson has announced that he’ll prorogue Parliament from September 12th to October 14th.
Mr Johnson has claimed that this is to give the him time to prepare his legislative agenda, as is Westminster convention when there’s a new government. However, Mr. Johnson’s critics say that it’s to prevent opposition MPs altering his Brexit plans. We’ll learn if opposition MPs succeed in passing a law preventing a ‘No Deal’ Brexit later today.
Boris Johnson will seek general election to gain parliament majority
However, now that MPs will debate legislation obliging Mr. Johnson to request an extension to Article 50, the PM has declared that he’ll seek a general election.
This is because, first, by voting to debate blocking a ‘No Deal’ Brexit, MPs have indicated that they don’t have confidence in Mr. Johnson’s Brexit strategy. Secondly, the PM has announced that the Conservative MPs who voted with the opposition yesterday will be banned from the Tory Party. This threat was meant to ensure Conservative MPs’ loyalty, yet 21 Tory MPs voted with the opposition yesterday, so Mr. Johnson has now lost his Parliamentary majority.
Given this, the PM will seek a general election to try and gain more MPs. It's thought that if the PM calls for a general election this week, it could be held on October 14th, before the UK exits the EU on Halloween.
Considering the UK’s quickly shifting political landscape and refreshed uncertainty about the future of Brexit, which has impacted sterling exchange rates profoundly until now, we have seen considerable movement in the sterling interbank exchange rate.
If you have an upcoming currency requirement, it could be pertinent to be in touch with your account manager so that we can keep you updated with the latest market movements that could impact your currency exchange. Get in touch with your account manager on +44 (0)1494 725353.