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Analysts at Rabobank notes that the markets are following the Brexit drama closely after the UK Prime Minister has suffered the humiliation of being booed at her own party conference as she referenced her Brexit Plans in a speech to the grassroots National Conservative Convention.

Key Quotes

“The reaction is further evidence of the difficulty the PM faces in finding sufficient support for her plans even if she managed to cut a deal with the EU.   As the reaction to May sparks another round of questions as to the longevity of her position, former foreign secretary Johnson has been given a boost by parliamentary king maker the DUP.”

“Leader Foster has praised his “positive” vision for Brexit and endorsed his “belief” and “sprit”.   GBP has dipped slightly vs. the USD this morning but has largely been holding its own in recent sessions despite the political uncertainty in the UK.”

“Yesterday’s better than expected UK manufacturing PMI release may have provided some comfort, though it is possible that investors are also encouraged by recent speculation of another Brexit referendum.   Not only was this issue raised at the Labour Party conference last week but various senior Conservative Party members are leaning towards a new vote.   These include former PM Major, former Home Secretary Rudd and Senior Tory Grieve.”