UK: Orderly Brexit is the most likely outcome - Rabobank

Analysts at Rabobank point out that the UK PM May has suffered the largest defeat by a government in the House of Commons for over a century, losing by 230.

Key Quotes

“Mrs May didn’t resign. That’s just not how she does things. Instead, she said that she doesn’t believe her deal is dead(!) and will continue cross-party discussions; but she has also said she will be shortly be back with something “more palatable” early next week. So we now have five days in feverish lobbying and arm-twisting to try to work out exactly what that is going to be.”

“Trying to bowl May a googly (please Google that), Labour leader Corbyn has confirmed that today will see a no confidence vote in the government. Expect that to actually be closer to under-arm bowling as she will almost certainly win, in which case an early general election is off the table and we are back to a “People’s Vote” as some kind of utopian totem for Labour to aim for.”

“That all said, GBP is actually up. As our own Alexandra Dumitru covers here, a ‘tweaked deal’ will likely be approved after all other options will have been exhausted, and some light concessions from the EU in the form of clarifications are offered. Hence, we still see an orderly Brexit as the most likely outcome, alongside an extension of Article 50.”