- UK government will vote overnight on UK repeal bill
- Corbyn has told Labour MPs to oppose the bill
- GBP making tentative gains at the start of what could be a big week
Shortly after midnight Britain’s parliament is expected to vote on whether the coalition government should have the power to transfer all existing EU legislation into domestic UK law from the day after Brexit. The bill is a cornerstone of Theresa May’s plans to ensure a smooth Brexit, and the prime minister is hopeful that the bill will pass at what will be the second reading.
Jeremy Corbyn, the leader of the opposition has told his MPs to vote down the bill, branding it a “power grab” by the conservatives. With Mrs May having only a working majority of 13, the vote is finely poised and although a handful of labour Eurosceptics are predicted to defy Mr Corybyn and vote in favour of the bill, its passage to the next stage is far from assured.
It’s a potentially pivotal week for the pound, with not only tonight’s vote but also the latest UK inflation figures scheduled to be released tomorrow ahead of the Bank of England meeting on Thursday. GBP is making small gains on the day with the biggest increases coming in GBPJPY and GBPCHF, albeit largely due to drops seen in the quote currency side of the pair due to the fall in JPY and CHF on the improving market risk sentiment.
The GBP is edging higher today, with the biggest gains coming against the JPY and CHF. Source: xStation
The GBPJPY cross could be particularly interesdting to keep a close eye on in the coming days with all the aforementioned GBP events as well as the pair’s risk-sensitive nature meaning that there could be some significant moves. Today’s trade has seen a potentially crucial break higher, with price rising to its highest level in over a month and breaking above prior resistance at 142.86. This resistance may be viewed as a possible neckline in an inverse head and shoulders setup with the head coming at the recent low of 139.46. The target for this formation, should it play out in a textbook manner would be at 146.26.
An inverse head and shoulders reversal pattern may be in play for the GBPJPY. Source: xStation