Outrage after Boris Johnson prorogues Parliament
The Brexit stakes were raised ever higher yesterday in a day of drama for the UK. Prime Minister Boris Johnson sought (and got) the proroguing of Parliament from the Queen who went ahead with her assent without much drama. As predicted this sudden move provoked a heavy reaction from the Opposition parties who now seem united against the government. Some Tories such as Dominic Grieve and Philip Hammond have also indicated that they might support a vote of no-confidence in their own party. The stakes are high in every sense of the word.
What exactly is a proroguing of Parliament? Effectively it is the shutting down of a parliamentary session curtailing any debate on current legislation. To be fair, this has been the longest session of parliament ever since 1700 so Johnson has some political leeway for such a drastic decision. However, he is clearly doing it to effectively halt any anti no deal measures that parliament might come up with.
The Queen approves prorogation
At the PM’s request, the Queen approved a “prorogation” of parliament between the week starting September 9 and October 14, its longest suspension since 1945. The pound fell as much as 1 per cent on Wednesday before recovering to trade 0.7 per cent lower.
The move was decried by John Bercow, Speaker of the House of Commons, as a “constitutional outrage”. Ruth Davidson, the popular pro-EU Tory leader in Scotland, is also expected to quit.
Johnson to call an election?
Mr Johnson defended the decision as an opportunity to introduce a new Queen’s Speech to set out his legislative priorities. But with parliament returning on September 3, there is little time left to avert an October 31 Brexit.
As already indicated, this political uncertainty is having an effect on the British pound and the forex markets in general. The pound could continue to fall if uncertainty continues and the markets could become a shade jittery on the back of all this sudden news. The next few weeks could be extremely interesting for Osprey FX customers as possible developments come to the fore. An early election is certainly on the cards.
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