(29JANUARY 2019)DAILY MARKET BRIEF 3:Brexit’s next test

In the UK, the House of Commons votes today on a second version of the Brexit deal. By most accounts it will also be rejected. Brexit fatigue is setting in. The high probability trade is of a compromise, resulting in a softer Brexit. No Brexit agreement would raise the probability of a second referendum and of the UK staying in the European Union. Opinion polls of remain/leave have not materially shifted since the Brexit referendum: we are uncertain of this outcome. This level of granularity in the middle of the UK’s greatest political knife fight feels disingenuous.