On Sunday 9th December, Conservative British Prime Minister Theresa May will debate with Labour Party Opposition Leader Jeremy Corbin on BBC TV at 8pm GMT the details of her proposed BREXIT Deal which many of the original BREXITEERS are unhappy with, and has already led to a number of cabinet resignations.
This debate is essentially to give her a last-minute opportunity to try and test her arguments for public consumption prior to an essential House of Commons Vote on the proposed arrangement that her Government has in principle agreed with the EU – which falls far short of what the architects of the “OUT” campaign had envisaged.
The House of Commons vote is to take place on Tuesday 11th December, prior to which, the House of Commons will have 5 days of debate on her compromise Brexit deal.
Most polls are currently showing that she will lose the vote, and this is where the difficulty truly begins. If she wins the vote, then it would be full steam ahead to exit the EU on 29th March 2019.
If she loses, then a number of things could occur:
- She could go back to the EU and attempt to refine the deal – however the EU has stated that it would not budge any further
- She could turn around to the EU and ask for more time to negotiate a further deal i.e. delay Brexit – we are not convinced she would get away with that.
- Her own Party could call for a vote of no confidence via the Conservative Party 1922 Committee, and if she loses that vote, a new leader and Prime Minister will be elected – but if that were to happen that new leader would more than likely be a Hard Brexit person such as Ian Duncan Smith, Boris Johnston or David Davies.
- She could win the Vote of no confidence and then potentially call a General Election to resolve the matter once and for all – but there is very little time available to achieve this and if her Party lost that election and the Labour Party were to win, they may arrange a new Referendum on Brexit, which they believe the ‘Remainers’ will win.
- If she wins she may call for a new Referendum herself asking 3 questions of the general public – To Remain, A Hard Brexit or her negotiated deal.
- She could do what David Cameron did and resign and leave the Country and Party in chaos.
Although the options seem plentiful, the reality is that if British Prime Minister loses the vote on Tuesday chaos will be the order of the day. We have already seen the price of gold rise by £70 per ounce in the past 4 weeks, though it has been little moved in US dollar terms, thereby reflecting the current weakness of sterling and this will no doubt continue, until these matters are finally resolved.
The irony is, that for markets to remain calm she has to win on Tuesday, however in doing so, she will have achieved a ‘soft Brexit’ or ‘compromise Brexit’ which is something that the hard and fast Brexiteers will brand a betrayal of the British people’s vote.
Until then, uncertainty dominates, and we foresee precious metal prices in sterling terms holding up if actually not rising a little further yet, and if the vote is lost, then do not be surprised to see another 5% -10% rise in precious metals shortly after – in sterling terms that is.