ING analysts note that the UK Prime Minister Boris Johnson has announced that parliament will be prorogued – or suspended – between the weeks of 9 September until 14 October, when the Queen’s speech will take place.
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“The big question for markets is: does this decision make a ‘no deal’ Brexit more likely?”
“We think the answer is yes – slightly – although we suspect the underlying motivation is to steer parliament’s anti-no deal efforts towards a vote of no confidence and election, rather than the legislative path that has emerged over recent days.”
“It goes without saying however that the next few weeks are heading into unchartered territory. For the pound, all of this means further weakness to come. “
“The result is that all of this may well go down to the wire. But while it’s tempting to conclude that the decision to prorogue parliament is to force through a ‘no deal’ exit, we aren’t necessarily convinced this is true. Mr Johnson could have set the date for the Queen’s speech much closer to the 31 October deadline – or indeed after it.”
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