Amplify Trading Global Markets Review - 17th October 2019

Amplify Trading Global Markets Review - 17th October 2019

Today's Highlights

  • UK and EU reach Brexit deal but DUP disapproves

  • EU Junker would rule out an extension

  • UK Government sets Meaningful Vote on Saturday on newly agreed deal

Macro Review

The "die is cast" is what Julius Caesar said before starting a civil war in Northern Italy which ultimately led him to become dictator of the flourishing Roman Empire in 49 BC. On a similar - probability less vigorous - note today Borish Johnson launched his renewed challenge to Westminster after achieving a brand new Brexit deal with the EU, which given the immediate disapproval of the DUP, will likely make Saturday emergency seating in the Commons the lunch of the Tories general election campaign rather than resolve in something truly meaningful. The second purpose of my intro is just to remind President Trump that when Cesar was conquering Europe, the US were not even known to the world. HERE

for more funny details.

The clock is ticking towards the Brexti deadline and today we were at least able to narrow down the options ahead in the hands of the UK Government. The EU and UK have reached a deal which differs from Theresa May's one mainly on the definition of the Irish backstop. PM Johnson has largely swapped Theresa's UK-wide backstop, which failed to get through Parliament three times, for a Northern Ireland-only backstop. The new deal includes a democratic escape mechanism from the backstop which allows the Northern Irish Assembly to withdraw its consent at anytime. However, according to analysts the withdrawal would be of difficult application, making the arrangement more a settled status for Northern Ireland rather than a temporary solution for the region. Moreover, the deal includes a custom border in the Irish Sea and avoids a hard border between NI and Ireland. 

Despite the DUP rejection to back the new deal, I guess closing a new deal today represent a boost to Boris no matter what happens on Saturday. In fact, at the start of his mandate, the EU had said it would not reopen the withdrawal agreement or re imagine the Irish backstop and the fact that the Prime Minister forced the EU to reshape Brexit is something that would definitely give him credit during a General Election campaign. For now, chances are that with the DUP voting down the deal, the rest of the hardliner Brexiteers will do the same, precluding a majority to pass the deal in Parliament. The magic number is 320, excluding the non-voting MPs. Here is your weekend game theory exercise. 

EU Close

If you missed the morning briefing from the desk click HERE

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