GBP/NZD has increased by 0.11% to 2.0141 as of 06:15 AM UTC. The pair is not decided which way to go next, currently fluctuating within a newly formed channel with resistance level 2.0220 and the support level at around 2.0045.
The quotation hit the highest level since July when it touched 2.0566 on October 16, but it has departed from the peak since then.
While the pound seems to be stronger than the Kiwi, the British currency is just benefiting from the latter’s vulnerabilities and is itself under pressure after UK Prime Minister Boris Johnson called for a national election to handle the Brexit by avoiding the parliament’s authority.
Johnson Seeking Another Election
Yesterday, Prime Minister Boris Johnson proposed a national election on December 12, thus admitting he wouldn’t manage to take the country out of the European Union (EU) by October 31.
He told his cabinet that a motion would be put to the vote in the parliament on Monday, October 28. Johnson has to secure the votes of 66% of MPs, meaning that the Labour party could veto the proposal. Last month, the PM tried to obtain approval for an election on occasions but failed.
The opposition parties, with the Labour in the first line, said they might support an election only if a no-deal Brexit is avoided at all.
For Johnson, an election is regarded as the only way to address Brexit given that the parliament has always impeded his plans.
Last week, the PM reached an agreement with European leaders and the UK parliament finally supported it on Tuesday in a preliminary vote. However, MPs rejected Johnson’s timetable which would meet the current deadline.
EU Decides Extension
Today, European ambassadors are meeting in Brussels to discuss the length of anther Brexit extension. The general sentiment is that the EU would grant a three-month delay, though no official decision has been made. Another option is to end Brexit earlier if a deal is ratified sooner than January 31 by the UK Parliament, thus allowing for a flexible delay.
On Thursday evening, Reuters saw a draft decision by the EU countries, which will be debated today by the European envoys. The text leaves the new date blank. The document reads:
“Consequently, the withdrawal should take place on the first day of the month following the completion of the ratification procedure, or on (blank), whichever is earliest.”
