(14 NOVEMBER 2018)DAILY MARKET BRIEF 1:Pound wavers on Brexit milestone

A Brexit deal is on the table, but will it pass this afternoon’s Cabinet meeting? The cable is currently trading sideways, meaning traders don’t know: we expect GBP/USD to head along 1.2840.

Under the proposed deal, the UK would remain within European Union rules for the environment, state aid, employment law and competition. Is that really Brexit? Well, at least the UK would not pay EU member contributions anymore. So, it is highly likely that Brexiteers will oppose this particular deal, which would turn out GBP-negative. If the deal manages to pass, a special European Council meeting would take place on 25 November to ratify. For now, we assume that the UK (along with Northern Ireland) will remain in the common market and that the end-November 2020 deadline should be the next deadline to look after March 2019, when the UK will leave the EU – with or without a deal.