4 ms·

It's getting closer and closer to a no-deal, and yet the pound doesn't really go down. Does anybody understand why?

• hlnas 8y ago
  Why should it? I think a no-deal should make it go up.
  • chc 8y ago
    Because a no-deal exit would do lasting damage to the British economy (this is a fairly uncontroversial point even among Brexit proponents), and a nation's currency tends to track its economy.
• jedberg 8y ago
  No deal Brexit has already been priced in. It's already taken the hit. If anything, a "with deal" Brexit or a withdrawal from the exit process (no exit) will probably make the pound go back up.
• jerf 8y ago
  It's hard to read the market's mind, but apparently the market doesn't think this is an apocalyptic event, or indeed, ultimately even likely to be that big a deal economically. There's no guarantee it is correct. But it is worth considering as a data point, keeping in mind its (anthropomorphized) perspective, as well as the other perspectives and where they are coming from as well. (This includes the predictions of apocalypse. There are many actors who are well motivated to predict that regardless of their own personal beliefs. This doesn't make their predictions false, either. I'm just an advocate of applying "follow the money/motivation" everywhere, even and at times especially to people who agree with your current perspective.)
• rtkwe 8y ago
  I think the consensus is they will just extend instead of actually going through a 100% no-deal Brexit. Seems like a fairly safe bet given the UK can do it unilaterally and how bad it would be.
  • vkou 8y ago
    Why would the EU allow the UK to extend this one-foot-in-one-foot out nonsense? It's not clear that any deal it is willing to offer will get parliamentary assent.
    • benj111 8y ago
      Because European courts have decided that Article 50 can be unilaterally retracted.
      • yongjik 8y ago
        I was under the impression that it can be only unilaterally "retracted" (i.e., cancel brexit), but extending the negotiation required EU's agreement, which already stated that they wouldn't unless there's a concrete plan?
        • benj111 8y ago
          Yes. In practice the UK would have to ask the EU for an extension, or article 50 could be retracted and resubmitted, achieving the same thing. There would be political barriers to doing that so the EU does have some bargaining power.
    • sparkie 8y ago
      The EU doesn't want the UK to leave. It would damage their project massively. It might even unravel it entirely if some other countries decide to follow in the UK's footsteps.
      • vkou 8y ago
        If the EU doesn't want the UK to leave, then its best option is the give the UK as much rope as it needs to hang itself, and pray that the UK comes to its senses, instead of giving it more time to negotiate a Brexit that will actually get parliamentary support. "We'll hold another referendum, and cross our fingers that this time, it will vote remain" isn't exactly satisfying to the EU.
• benj111 8y ago
  Theres a vote tomorrow on whether to reject a no deal brexit, the the consensus is that will pass, with the PM presumably asking for an extension, so no deal still isn't a given.
• dragonwriter 8y ago
  Because either (1) no deal is already priced in, or (2) markets remain confident that the upcoming sequence of votes before them will lead to some other outcome than imminent no deal Brexit.