The British pound attracted the lion’s share of attention Tuesday as the U.K. Parliament debated amendments to a proposed Brexit deal.
Meanwhile, other major currencies, like the U.S. dollar, the euro and the Japanese yen traded in tight ranges, with little on the economic calendar ahead of Wednesday’s Federal Reserve policy update and Chinese economic data.
Sterling GBPUSD, -0.1140% was last slightly weaker at $1.3140, compared with $1.3157 late Monday, having fallen back from its session high of $1.32 on the back of Prime Minister Theresa May’s address to the Parliament earlier. The euro EURGBP, +0.0921% was up 0.1% versus the pound at £0.8691.
May proposed to reopen the Brexit deal with the European Union even though Brussels had previously rejected the option to renegotiate. The prime minister had spoken to European Commission President Jean-Claude Juncker ahead of her speech, according to Reuters. Details of their phone call were not disclosed.
Two weeks after May’s initial proposal was rejected, Parliament will debate and vote on various amendments to the Brexit deal.
“Among the many [amendments] to be considered will be the Brady amendment that calls for an alternative to the [Irish] backstop, although [it] remains so vague in specifics as to be nearly meaningless,” wrote Boris Schlossberg, managing director of FX strategy at BK Asset Management. “There is a strong chance that all the amendments may fail which would leave Prime Minister May essentially at a standstill.”
Besides Brady’s backstop amendment, Parliament will also vote on the Grieve amendment, which would allow for six further debates and give Members of Parliament the chance to bring further amendments as well as the Cooper amendment to delay Brexit if no deal was reached by Feb. 26, and the Spelman amendment that rules out a no deal Brexit. The Labor Party is also still looking at the option of a second referendum.
Meanwhile, some pro-leave and pro-remain politicians in May’s Conservative Party have agreed to a secret Brexit compromise — coined the Malthouse compromise or Plan C — to ensure an orderly Brexit and reunite their party. Ian Blackford of the Scottish National Party used his time in Parliament to stress Scotland’s ties to continental Europe, and broaching the topic of Scottish independence.
Elsewhere, U.S. consumer sentiment for January fell to an 18-month low amid the partial government shutdown that lasted for much of the month.
The ICE U.S. Dollar Index DXY, +0.07% was 0.1% stronger at 95.806 while the euro EURUSD, +0.0000% was 0.1% weaker at $1.1420.
The dollar softened against the Japanese yen USDJPY, +0.02% falling 0.1% to buy ¥109.30.
Read: Why the yen is still a haven despite Japan’s sluggish economy
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