Updated October 25, 2018
Shot themselves in the foot? Yup, that sounds about right; Theresa May might be saying farewell to this entire ordeal. Nicky Morgan forecasts that Theresa May will not last that long at Downing Street, as things are really getting out of hand. The Irish border issue is literally becoming a political Rubix Cube with no possible way to get it done. Markets are anxious, the pound is on a joyous roller coaster ride, and more and more of the British Government's top leader are giving the fare well to the game. The EU is now being accused of being "intransigence", as Mr. Raab, Dominic has stated yesterday.
The EU has a mandate to speak for the interest of 28 nations; indeed the EU's position should be more sturdy, in the case of teh UK however, the interests of one nation, who has voluntarily with all due desire decided to leave the block, are being used as a perspective and a benchmark for their arguments. The European Union and the chief negotiators are only trying to ensure that no European state's interests are being compromised by the deal.
Turmoil is really painful to financial markets. Leaders engrossed in the negotiations are oblivious to the effects of the uncertainty on investor confidence.
The United Kingdom continues to suffer the headwinds of Brexit. This time it is the governor of the Bank of England Mark Careny who stirred things up. In an interview with the BBC last week, the governor of the Central Bank of England slammed the brakes on further interest rate rises. The British Pound has inexplicably been appreciating since the Theresa May government had announced that it had reached a transitional period understanding with the EU. This agreement gave investors the confidence that the UK may end up leaving the EU on good terms, or what is commonly referred to as Soft Brexit.
ACIC Inc. has advised its UK clients to practice caution investing the pound or any of its derivatives until March, 2019 unveils the final works of the departure. The Irish border remains one of the most complex matters on the discussion table now. The solutions being offered by the UK are not being considered as practical by the EU and were struck down. Immigration matters continue to be the hottest driver of Brexit and negotiations.
If the United Kingdom does not manage to reach a term of exit that is truly a well rounded “Soft Brexit,” immigration consequences could be severe and crippling to investments, workers and bilateral relationships.
The British Pound has possibly started a serious downtrend that could re-experience the flash crash that happened back in 2017.
