Brexit: The date has been moved to January 31. But will it change anything?

President of the European Parliament Donald Tusk announced that the European Union has complied with the request of Great Britain to postpone the deadline Brexitu. The British have until 31.01.2020 a year to agree on a withdrawal agreement. One thing is certain: by the end of January next year there will certainly be no so-called hard Brexit. The pound rate reacted calmly to this information and entered the consolidation phase.

Everything indicates that at least the turn of the slowly ending year will be somewhat calmer for investors from the Forex market who are interested in the price of the British pound. Until now it was a real roller coaster, but its route led mainly down. Many wallets, however, could not withstand significant accelerations and overloads, which drew the president's attention Bank of England and the European Commission. Price changes - especially on the so-called "Cable"that is, the price of the pound against the dollar - they were huge. The increase or decrease could reach 1%. in less than an hour. Effect? Many individual investors have lost a lot from this. Therefore, work is already underway on further restrictions that are to affect the Forex market. They are intended to protect mainly small investors against a quick loss of capital.

Be sure to read: Speculation on the pound attracts black clouds on Forex

Following the decision of the European Parliament, the exchange rate of the British currency should behave a bit calmer in the coming months - at least theoretically. The European Union has agreed to another postponement of Brexit in order to avoid Britain leaving the European community without a deal, which, according to all analyzes, would have a disastrous ending not only for the economy, but above all it would have caused difficulties for many ordinary Europeans - both living in Great Britain, and beyond.

“The EU27 has agreed to agree with the UK's request to extend Brexit to January 31, 2020. The decision will come into force after its written formalization " - wrote Donald Tusk, President of the European Parliament.

The UK's proposer does not specify a specific date for leaving the EU. The deadline of 31.01.2020/XNUMX/XNUMX is a cut-off date, because signing the exit agreement earlier guarantees that the British will leave the community on the date contained in the agreement. The problem is that so far, despite many attempts and tens of hours of negotiation, it has not been possible to work out it. Despite the fact that we have heard many times that virtually all the details have already been discussed, the proposal is "serious and acceptable", only the last paragraphs are missing and so on. other European leaders expected. And the stalemate continued. Now at least we know until when we can expect specific decisions.

Hard Brexit away

However, the extension of the Brexit deadline imposes certain obligations on the British. The agreement does not provide for its unilateral breakage and Britain's exit from the EU without a contract. Thus, by the end of January next year, we can be sure of two scenarios: Great Britain will remain in the European Union until that date or leave its structures earlier, but only after signing the agreement. The so-called. hard Brexit is impossible during this period.

EU politicians also keep reminding the UK authorities that they have the full right to cancel Brexit, and the result of the referendum held in the British Isles is not binding from the point of view of EU law. However, this is hardly to be expected, given that Prime Minister Boris Johnson is an outspoken Eurosceptic and does everything - despite internal political problems - to "free the country" from the European Union as soon as possible.

The pound reacted relatively calmly to Monday's signing of the agreement. On Tuesday morning, too, no great and nervous movements can be seen. The chart has definitely entered consolidation and is awaiting further market information.