EUR/GBP recovers to 0.8550 after indicative votes in UK parliament

• British MPs remain against their own indicative proposals for Brexit, increasing the uncertainty for the departure.
• Theresa May’s third proposal also gets a mixed response despite her readiness to resign.

The EUR/GBP is taking the bids around 0.8550 during the early Asian session on Thursday. The pair surged after results of the indicative votes on eight Brexit issues show the MPs are not making the departure path smooth. Traders may now await German inflation numbers and Friday’s voting on the British PM Theresa May’s third Brexit proposal.

Eight Brexit issues ranging from no deal Brexit to the second referendum were up for ballot in the UK House of Commons by various MPs after they won the votes for an amendment that may allow the parliament an upper hand to the Government in case of the Brexit. 

Overall, all of the eight issues were rejected with Ken Clarke’s customs union proposal getting a close call between the 264 supporters and 272 in opposition. Also, least support was given to George Eustice’s Efta and EEA proposal with 65 yes and 377 no. The British MP behind this process, Oliver Letwin, said earlier in the day that he already expected such an outcome.
While the indicative vote results are out, some among the MPs are arguing to again put these proposals for a vote sometime next week if possible. Though, no clearance is out on it yet.

On the other hand, PM May’s third proposal to Brexit will be up for voting in the parliament sometime on Friday. She has shown readiness to resign once parliament accepts her proposal but Democratic Unionist Party (DUP), her major alliance, still signals they might turn her down if the deal isn’t significantly different.

At the EU, German preliminary reading of the harmonized index of consumer price index (CPI) data for March will be released. Expectations suggest 1.6% mark against 1.7% prior for an MoM print.

EUR/GBP Technical Analysis

The EUR/GBP pair need to sustain a move beyond 0.8550 in order to aim for 0.8600 and further target 0.8670, 0.8720.

Alternatively, 0.8470 and 0.8380 are likely important supports to watch.