What is the Brexit timeline for October and November? Dates every trader should be aware of

Published date: 10/10/2019
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Brexit has already proven to be very complicated but those weeks have been crunch time for negotiations in both, the EU and the UK. The Byzantine process is impacting the market once again, with massive volatility across all GBP pairs. 

Market participants must do extensive research to understand the implications of both scenarios: a deal and a no-deal. In the following paragraphs we will make your life a bit easier by listing the most important dates to take into account and what can we expect from both scenarios. 

 

SCENARIO 1: the UK and the EU agree on a new deal during the European Summit

If both agents agree, then MPs in the UK most back the new deal before the 31st of October. This is the best possible scenario, because if the negotiations go well, then Brexit would be done and dusted. 

If the MPs do not agree with the new terms negotiated between the EU and the UK, then they will certainly propose a delay to keep debating the clauses of the deal in the House of Commons. In this case, if the delay is accepted by the EU and the MPs finally agree on the new deal, then again, Brexit will finally happen. On the contrary, if no agreement inside the UK happens (even with the delay in the process), then a vote of no-confidence is very likely to happen. 

 

SCENARIO 2: The UK and the EU cannot agree on a deal during the European Summit

Comply: The UK negotiators will request a delay to the European Legal Commission.  If the delay does not get approved there is a no-Brexit deal and also a vote of no-confidence. 

Ignore: The legal process is blocked. Another legal mechanism must be used to solve the disagreement (this situation is very unlikely). 

PM resignation: If the Brexit is not done and the process gets more complicated than expected, Johnson may face pressure to resign. 

 

SCENARIO 3: Government looking forward to doing an early General Election

If Brexit is delivered, things will calm down and probably an early election won't be needed. 

If Brexit is not delivered after the 31st of October (and there is still a lot of discontent around the methods used by Johnson) a GE is very probable. If MPs vote on the election and it passes, then the existing PM will decide the Election Date. On the contrary, if the MPs vote but the motion fails, the government must seek alternative route to the election. For the GE to happen, the motion needs a 2/3 majority in the House of Commons. 

 

So far those are the scenarios you must take into account. The next crucial dates you should mark on your calendar are the following: 

* October 14th: Queen’s Speech

* October 15th: Europe Ministers meet in Luxembourg

* October 17th/18th: EU Summit 

* October 19th: Special Parliament sitting (and a possible request of an extension).

* October 31st: Brexit Day

* November: UK transition out of the EU begins (if a deal is reached) or a General Election is held in the UK + a delay. 

 

All in all,  there are 21 days left for the Brexit deadline to happen and the market is pricing in the uncertainty of traders. GBP pairs have been moving over 100 pips in the last few days and traders are certainly experiencing challenging times, where patience, preparation, and caution is needed.  EURGBP and GBPUSD exchange rate will continue to be driven by Johnson’s trials and the overall developments in the process.  

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