Cable is sliding and GBPEUR is at one-week lows following reports that UK’s opposition Labour Party will back a Tory rebel amendment to Theresa May’s trade bill, a key piece of Brexit legislation – leaving her at risk of defeat following last night’s razor thin majority.
As a reminder, last night saw Brexiteers narrowly defeat Tory rebels by just three votes on two amendments, and now the Labour Party has reportedly chosen to back a new amendment to the current Trade Bill, put forward by Tory MPs Stephen Hammond and Nicky Morgan that would force the Government to stay in the customs union if Brussels cannot be persuaded to allow Britain a free trade area by January 2019.
If all opposition lawmakers back the change it would only need seven Tories to rebel for May to be defeated.
The result is weakness in Sterling vs the dollar and Euro.
The rebellions are “a prelude to the big — and real — battle coming in the winter when the PM comes back with her deal and we know what the choice is. And whether she can continue,” Tory lawmaker George Freeman, who used to head May’s policy board, said in a posting on Instagram. “Brexit is coming home to roost. And it won’t be easy or pleasant.”
Voting on the Trade Bill begins mid-afternoon and the customs union vote will take place this evening about 6pm (1pm ET).
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