- Posted by currencies in Bank of England, Bremain, Brexit, Budget, Currency, Dollar, Economy, EUR, GBP, Prime Minister, Rate Cuts, Referendum, Sterling, UK, Uncategorised
- July 25, 2019
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Prime Minister Boris Johnson will meet his Brexiteer-dominated team of senior ministers for the first time today to plot how to persuade the European Union to agree to a new Brexit deal ahead of the Oct. 31 exit deadline.
Johnson’s dramatic rise to Britain’s top job sets the world’s fifth largest economy up for a showdown with the EU and a potential constitutional crisis – or election – at home, as lawmakers have vowed to thwart a no-deal Brexit.
Britain’s new leader promised to do a new Brexit deal with the bloc within less than 99 days but warned that if EU leaders refused – what he termed a “remote possibility” – then Britain would leave without a deal, “no ifs or buts”.
Johnson to make statement to parliament on Thursday
The bloc has congratulated Johnson on his victory but was firm that it would not offer Britain better departure terms.
A total of 17 ministers in May’s government either resigned or were sacked, creating a powerful new group of enemies in parliament. Most of Johnson’s senior appointees are Brexit supporters.
Sajid Javid, 49, was named as his finance minister. He is a Eurosceptic who voted to remain in the 2016 referendum.
Others are avowed Brexiteers: Priti Patel was appointed interior minister, Dominic Raab was appointed foreign minister and Stephen Barclay remained as Brexit minister.
Johnson also appointed Dominic Cummings, the campaign director of the official Brexit Vote Leave campaign, as a senior adviser in Downing Street.
The euro sank to a new two-month low against the dollar this morning as investors waited for the European Central Bank to confirm that borrowing costs will get cheaper and that it will start buying bonds again.
Money markets are pricing in a 50% chance of a 10-basis points interest rate cut by the ECB later today, a smaller probability than last week, but some expect that President Mario Draghi will open the door for further cuts down the road or for more quantitative easing.
However, some analysts expect the central bank to be way less dovish and only tweak its forward guidance by re-introducing the easing bias.