Brexit is going to be delayed and may even be cancelled following British Prime Minister Theresa May’s massive defeat in Parliament Tuesday night.
That’s according to the money being wagered at British bookmakers and on British betting exchanges.
Bets placed at leading person-to-person betting exchange Betfair now give Brexit, or Britain’s departure from the European Union, an 80% chance of being delayed past the official March 29/30 deadline, prices show.
And they are now showing a 25% chance that Brexit will be delayed at least until 2022 — and may even never happen.
“We’re seeing a lot of action on Article 50 to be delayed beyond March 30,” says Amy Jones, spokeswoman for Betfair’s parent company Paddy Power Betfair PDYPF, -1.19% Article 50 is the technical measure by which Britain would leave the European Union. “It’s now odds-on at 1/4 to be delayed, in from as large as 2/1 in late December,” she added.
What that means in layman’s terms: The betting odds on a delay have surged from 33% to 80% since just before New Year’s.
Jones adds that bets are growing on a second Brexit referendum in order to break the political gridlock. The first, in 2016, stunned the world when the British voted to leave the EU.
Under less tumultuous circumstances, the PM would likely have resigned
British Prime Minister Theresa May’s painfully-negotiated Brexit deal with Brussels went down to crashing defeat Tuesday night, losing the parliamentary vote by 432 votes to 202, a margin even wider than any responsible source had predicted.
It was the most humiliating parliamentary defeat by a sitting prime minister in modern history and, in ordinary circumstances, would have been followed automatically by the PM’s resignation, noted leading U.K. political analysts.
She will face a “no confidence” motion in Parliament Wednesday evening, though the betting so far is that she will survive that. A “no confidence” motion is a parliamentary vote to bring down a government.
Many members of her ruling Conservative party balked at the Brexit deal she had negotiated with the European Union, but do not wish to force a general election that they might lose. Jeremy Corbyn, the leader of the opposition Labour Party, comes from the party’s far left, radical socialist wing.
Gambling markets have a long pedigree in the U.K.’s loose regulatory environment, and are sometimes good at signalling political surprises ahead of conventional wisdom. A recent study by Cambridge University found that betting at exchanges such as Betfair had done a better job of anticipating the 2016 referendum shock than some other markets.
Meanwhile the British pound appeared to stabilize at around $1.28 to the U.S. dollar following the government’s Brexit defeat, which had been widely anticipated.
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