08 Jan 2019
A meaningful vote on Brexit
Parliament returns from its Christmas recess today, with MPs set to begin (resume) the debate on the Brexit deal struck with Brussels on Wednesday
In an effort to try and win over support for the deal from her party, Prime Minister Theresa May has invited Conservative MPs to drinks receptions at 10 Downing Street both today and on Wednesday.
While it is currently unknown how many days the deal will be debated for before it is put to a so-called meaningful vote, numerous media outlets report that 15 January has been pencilled in by the government. Indeed, the Prime Minister appeared to confirm such reports after being asked on the Andrew Marr Show whether the vote would take place on 15 January, to which she replied “That sort of timing, yes”.
Note that if the government does indeed press ahead with its plans to hold the vote next week, then the latest day it can publically announce it is on Thursday as Leader of the House of Commons Andrea Leadsom will need to set it out in the order paper for next week.
UK this week
All things Brexit is set to be thrust firmly back into the spotlight as Parliament returns from its Christmas recess today and begins (resumes) debating the deal struck with Brussels on Wednesday. After a number of days for debate, the ‘meaningful vote’ is then expected to be held at some point the following week, we have a more detailed note below in our ‘Thought of the day’.
Ahead of all this, the Prime Minister has been seeking further assurances from EU27 leaders that the ‘backstop’ will be time-limited in nature in an effort to shore up parliamentary support for the deal, though at this stage it is not clear whether it will be enough to convince MPs.
In terms of UK data, the key release will be Friday’s monthly GDP report for November for which we expect to see a repeat of October’s 0.1% uptick. Other releases include SMMT car registrations today and the BRC Retail Sales Monitor on Thursday.
US this week
Following last week’s global equity rout and subsequent bounce on Friday, the US Congress got back to work in Washington DC on Thursday, with the Democrats now having assumed control of the House of Representatives.
Brokering a bi-partisan deal to end the partial government shutdown is now a more challenging prospect and one that looks set to rumble on into this week. Some data releases have been delayed on account of departmental closures amid the standoff on Capitol Hill.
Releases set to go ahead this week include the non-manufacturing ISM today, the JOLTS report on Tuesday and CPI figures rounding off the week on Friday. Note also that the minutes of December’s FOMC meeting are due to be published on Wednesday.
Following the Fed Chair, Jerome Powell’s somewhat dovish comments of Friday, these minutes may not be as important in setting the tone for markets this week given the fact that his recent comments were probably aimed at downplaying the overtly hawkish communication that emanated from that meeting which is widely perceived to have been the touch paper for the Dec/Jan equity sell off.
Europe & ROTW this week
European investors will also have plenty to chew over this week. Industrial production figures are out for Germany (Tuesday), France (Thursday) as well as Italy and Spain (Friday). For the Eurozone as a whole, business and consumer confidence figures will be published on Tuesday with the unemployment release following on Wednesday.
Destatis will also report November manufacturing orders and trade figures for the bloc’s biggest economy. Over in Asia, Japan sees consumer confidence figures published on Tuesday and the Economy Watchers Survey on Friday.
Meanwhile, China’s National Bureau of Statistics is set to publish CPI and PPI inflation figures on Thursday, with monthly lending and money supply figures possibly being released at some point during the week.
10.00 EZ Retail Sales
15.00 US ISM Non-Manufacturing PMI
17.40 US FOMC Bostic Speaks