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Boris Johnson Might Not Even Get His Brexit Vote on Saturday

Yahoo World News Feed - October 18, 2019 - 9:16am

(Bloomberg) -- Boris Johnson may not even get the chance to put his Brexit deal to the vote on Saturday, with support growing for a move by an alliance of former Conservatives and opposition Members of Parliament to delay the decision by a week or more.Former Tory minister Oliver Letwin and Labour MP Hilary Benn have put down an amendment to Johnson’s motion which would withhold approval for the Brexit deal until the bill that implements it is law.If it is passed, Johnson would be unable to put his deal to the vote, leaving him in a situation where he’s obliged by law to seek a delay to Brexit.The main opposition Labour Party is likely to order its MPs to support the amendment, according to two people familiar with the party’s plans. Other opposition parties are also on board. Nicola Sturgeon, leader of the 35-seat Scottish National Party, said she’s “sympathetic” to the plan and would back anything that makes sure the deal doesn’t go through on Saturday.Johnson doesn’t have a majority, so a united opposition and the support of former Tories, such as Philip Hammond and David Gauke, gives the move a good chance of passing.The amendment says Parliament should withhold approval of the deal “unless and until implementing legislation is passed.” That would automatically trigger the Benn Act, which says the prime minister must ask the EU for an extension if he hasn’t finalized a deal with both the EU and U.K. Parliament by Oct. 19.“My aim is to ensure that Boris’s deal succeeds, but that we have an insurance policy which prevents the U.K. from crashing out on Oct. 31 by mistake if something goes wrong during the passage of the implementing legislation,” Letwin said in an email. “Nothing in my amendment or in the Benn Act itself in any way delays the actual departure of the U.K. from the EU immediately following the ratification of the Withdrawal Agreement.”Letwin won’t know until Saturday morning if his amendment has been selected for debate by Speaker John Bercow.(Updates with Letwin in seventh paragraph.)To contact the reporters on this story: Robert Hutton in London at rhutton1@bloomberg.net;Jessica Shankleman in London at jshankleman@bloomberg.netTo contact the editors responsible for this story: Tim Ross at tross54@bloomberg.net, Thomas Penny, Andrew AtkinsonFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.


UK lawmaker Letwin says his amendment designed to block accidental no-deal

Yahoo World News Feed - October 18, 2019 - 9:06am

British Lawmaker Oliver Letwin said on Friday he wanted to make sure Britain did not leave the European Union without a Brexit deal by mistake, explaining a proposal that could prevent a vote on Prime Minister Boris Johnson's Brexit deal on Saturday. Letwin has proposed that the approval of the deal is deferred until separate legislation to implement the terms of the deal has passed through parliament. "My aim is to ensure that Boris’s deal succeeds, but that we have an insurance policy which prevents the UK from crashing out on 31 October by mistake if something goes wrong during the passage of the implementing legislation," Letwin said in an explanatory note sent to reporters.


Macron Says U.K. Shouldn’t Get New Delay If Johnson Loses Vote

Yahoo World News Feed - October 18, 2019 - 8:59am

(Bloomberg) -- French President Emmanuel Macron heaped pressure on the British Parliament to back Boris Johnson’s Brexit deal, saying the U.K.’s departure from the European Union shouldn’t be delayed a moment longer.With Parliament due to vote on the revised agreement on Saturday, Macron’s remarks echoed the message Johnson himself has been sending to reticent MPs: it’s now or never. "I don’t think a new extension should be granted," Macron told reporters after a summit of EU leaders in Brussels, where the deal had been rubber stamped. "The Oct. 31 deadline must be met."Macron’s stance increases the risk that the U.K. will crash out of the EU without a deal on Oct. 31. But the reality is more nuanced, according to EU diplomats who doubt the bloc will ever throw the U.K. off a cliff without a safety net. The pound dipped on the comments, and then recovered.Selling the DealAfter sealing a revised deal with the EU on Thursday, Johnson is spending Friday frantically talking to politicians from his own and other parties as he tries to rustle up a majority. The prime minister needs to add 61 votes to the tally his predecessor Theresa May managed when her version of the Brexit deal was defeated for a third and final time in March.The new agreement differs from May’s agreement because only Northern Ireland rather than the whole U.K. will continue to apply the EU’s customs rules. That’s upset the province’s Democratic Unionist Party whose MPs say they won’t back Johnson’s deal on Saturday.If Johnson loses the vote, he’s obliged by law to request from the EU another extension by the end of the day. But any postponement must be approved unanimously by the EU’s 27 leaders so Macron would have a veto.EU officials were expecting such an intervention by Macron, who made similar noises before approving a Brexit delay in April, but they said that it’s very unlikely that he or any other leader would prevent another one, particularly if the U.K. was headed for a general election. While the bloc is just as keen to get Britain’s departure over the line as Johnson, it considers a no-deal exit in two weeks a far worse prospect than another postponement.Envoys from the 27 remaining countries and the European Commission are due to meet on Sunday to discuss next steps should Johnson’s deal fall.The French have consistently taken a hard line in Brexit negotiations and Macron argues that the tight deadline he insisted on the last time the process was extended helped force Johnson into concessions. Several EU governments privately now regret delaying Brexit from April until October, acknowledging that it took the pressure of the U.K. to pass a deal."I was alone and I don’t think I was wrong," Macron said, referring to the decision six months ago.Other leaders were more circumspect on the issue, with Leo Varadkar, the prime minister of Ireland, which stands to be affected most by a no-deal Brexit, saying a delay isn’t guaranteed and Luxembourg premier Xavier Bettel insisting the ball was now in the U.K. Parliament’s court.“We have done our job,” he said. “There’s a plan A, but there’s no plan B."(Updates with context throughout.)\--With assistance from Stephanie Bodoni.To contact the reporters on this story: Helene Fouquet in Paris at hfouquet1@bloomberg.net;Ian Wishart in Brussels at iwishart@bloomberg.netTo contact the editor responsible for this story: Ben Sills at bsills@bloomberg.netFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.


Johnson May Not Get His Decisive Vote on Saturday: Brexit Update

Yahoo World News Feed - October 18, 2019 - 8:57am

(Bloomberg) -- Boris Johnson is talking to MPs as he tries to build a majority in Parliament for the Brexit agreement he reached with the European Union on Thursday. But rebels expelled from his own Conservative Party are moving to postpone the decisive vote -- forcing the prime minister to seek a further extension from the bloc.French President Emmanuel Macron added to the pressure on MPs weighing how to vote when he told reporters in Brussels that a further extension shouldn’t be granted if Parliament rejects the deal.Must read: Two Crisis Phone Calls Unlocked the ‘Impossible’ Brexit DealKey DevelopmentsJohnson to meet with cabinet in London at 4 p.m.Johnson Sells Brexit Deal to Parliament Before Knife-Edge VoteDUP reaffirms its 10 MPs will vote against Johnson’s dealSNP Indicates Support for Vote Delay (3.30 p.m.)Nicola Sturgeon, leader of the Scottish National Party, suggested her party would vote for a proposal to delay the vote on Johnson’s deal until after Saturday. The amendment, drawn up by former Tory Oliver Letwin and Labour’s Hilary Benn, would withhold approval for the Brexit deal until the bill which implements it is law (see 3:15 p.m.).“We will ultimately vote against this deal but we would be sympathetic to something that would make sure it doesn’t get through tomorrow,” Sturgeon told reporters in London. She said an extension to the Oct. 31 deadline followed by a general election or a referendum would be her preferred outcome.Saturday May Not Seal the Deal (3:15 p.m.)Boris Johnson may not even get the chance to put his Brexit deal to the vote on Saturday, with support growing for a move by an alliance of former Conservatives and opposition Members of Parliament to delay the decision by a week or more.Former Tory minister Oliver Letwin and Labour MP Hilary Benn have put down an amendment to Johnson’s motion which would withhold approval for the Brexit deal until the bill that implements it is law.If it is passed, Johnson would be unable to put his deal to the vote, leaving him in a situation where he’s obliged by law to seek a delay to Brexit.Don’t Assume EU Extension, Varadkar Says (2:30 p.m.)U.K. lawmakers should not assume the EU would grant another Brexit extension if it’s requested, Irish Prime Minister Leo Varadkar warned, noting such a move would need unanimous consent from EU members. The current proposal is the final offer, he added.Speaking to reporters in Brussels, Varadkar said he “cannot see the European Union coming back for another set of negotiations” if the British Parliament rejects this plan. Asked what the alternative is if this deal is shot down in Westminster, he responded that "plan B is no deal."Macron Says U.K. Mustn’t Get Delay If Vote Fails (2 p.m.)French President Emmanuel Macron said the U.K. should not get another extension to the Brexit process if Boris Johnson loses the vote on his Brexit deal in Parliament on Saturday."I don’t think a new extension should be granted," Macron said at a press conference after a summit of EU leaders in Brussels. "The Oct. 31 deadline must be met."BNP: U.K. Stocks Could Drop 10% If Vote Lost (12:20 p.m.)Stocks with heavy exposure to the U.K. economy could wipe out the rally seen over the past week if MPs reject Boris Johnson’s Brexit deal on Saturday, according to BNP Paribas.The bank forecasts downside of as much as 10% for the FTSE 250 index in such a scenario, with the exporter-heavy FTSE 100 gaining amid weaker sterling, strategists including Edmund Shing wrote in a note to clients.Johnson Goes on Charm Offensive (12 p.m.)With Saturday’s vote looking incredibly tight, Boris Johnson and his team are spending the day trying to persuade MPs from all parties to back his Brexit deal.Labour MPs are being offered more assurances on workers’ rights in the Withdrawal Agreement Bill, which would be brought to Parliament next week if Johnson wins on Saturday, according to a person familiar with the discussions.The Prime Minister’s personal focus is on winning around hard line Brexiteers in the European Research Group, and that operation is starting in earnest today, the person said.The government currently thinks about 17 or 18 of the 21 rebels who were expelled from the Tory party last month will back the deal, the person said. Many of them are seeking a way back into the party and want assurances any MP who votes against the government this time around will also be expelled.DUP Affirms Opposition to Deal (10:30 a.m.)Sammy Wilson, the DUP’s Brexit spokesman, extinguished any hopes his party will pivot toward supporting Johnson’s deal. “We will definitely be voting against it,” he told Sky News.Wilson said he’s disappointed Johnson “folded to the unreasonable demands of the EU,” especially since the DUP had given him a “fair degree of latitude” on temporary Northern Irish regulatory alignment with Europe.While acknowledging tariffs on goods coming into Northern Ireland from the U.K. would be refunded if they are proven not to have entered the Republic of Ireland, Wilson said the cash-flow problems this would create for local businesses would be damaging.At Least 10 Labour MPs Back Deal, Mann Says (Earlier)As speculation mounts over the way votes will fall on Saturday, Labour’s John Mann said at least 10 Labour MPs are likely to vote for Johnson’s deal. Asked on Ireland’s RTE radio how many of his party would back Johnson’s Brexit proposal, Mann responded that he expected the total to be in the “double digits.”Mann, who will vote for the plan, supported former prime minister Theresa May’s deal and is a vocal critic of Labour leader Jeremy Corbyn, who has called for Labour MPs to reject the deal.Earlier:Johnson Sells Brexit Deal to Parliament Before Knife-Edge VoteLondon Bankers Ready for Wave of Debt Deals If Johnson Wins Vote\--With assistance from Peter Flanagan, Joe Easton and Helene Fouquet.To contact the reporters on this story: Robert Hutton in London at rhutton1@bloomberg.net;Jessica Shankleman in London at jshankleman@bloomberg.net;Greg Ritchie in London at gritchie10@bloomberg.netTo contact the editors responsible for this story: Tim Ross at tross54@bloomberg.net, Thomas PennyFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.


At least 62 killed in Afghan mosque blast

Yahoo World News Feed - October 18, 2019 - 8:50am

At least 62 people were killed by a blast inside an Afghan mosque during Friday prayers, according to officials, a day after the United Nations said violence in the country had reached "unacceptable" levels. The explosion, which witnesses said collapsed the mosque's roof, took place in eastern Nangarhar province and also wounded at least 33 people, provincial governor spokesman Attaullah Khogyani told AFP. Some 350 worshippers were inside at the time, local resident Omar Ghorzang told AFP.


Hong Kong protesters don cartoon masks to defy face mask ban

Yahoo World News Feed - October 18, 2019 - 8:46am

Hong Kong pro-democracy protesters donned cartoon character masks as they formed human chains across the semiautonomous Chinese city on Friday night, in defiance of a government ban on face coverings at public assemblies. Chinese internet users have joked that Chinese President Xi Jinping resembles the talking bear, leading the country's censors to scrub online references to the character. The protesters were taking a lighthearted approach to oppose the government's decision this month to invoke colonial-era emergency regulations banning face masks at rallies as it struggles to contain the chaotic protest movement.


Nationwide Protests Erupt in Lebanon as Economic Crisis Deepens

Yahoo World News Feed - October 18, 2019 - 8:41am

(Bloomberg) -- Thousands of protesters cut off roads and started fires around Lebanon as anger over plans to impose a levy on WhatsApp calls escalated into demands for the government to resign.Demonstrators carrying Lebanese flags thronged outside government headquarters in downtown Beirut on Friday, as some of the largest protests in years entered a second day.Chants of “the people want the fall of the regime” and “revolution” rang out and scuffles erupted with riot police as the crowds demanded the politicians currently debating a proposed austerity budget step down and hold early elections.The economic stakes have rarely been higher for Lebanon, a tiny country that straddles the geopolitical fault-lines of the Middle East, since the end of the 15-year civil war in 1990. One of the most indebted countries in the world, it is struggling to find fresh sources of funding as the foreign inflows on which it has traditionally relied have dried up.The protests have increased pressure on Prime Minister Saad al-Hariri, who heads a fractious coalition government that has struggled to overcome sectarian and political differences to push through much-needed reforms.Hariri, a Sunni Muslim, has been traditionally backed by Saudi Arabia, but the kingdom has withheld support in recent years as the Iranian-backed Hezbollah militia’s political influence over the government has grown.The crisis has catapulted Lebanon into a new and unpredictable phase. If Hariri and his allies resign, Lebanon could end up with a government dominated by Hezbollah, making it even harder to attract investment. Hezbollah’s ministers and parliamentarians have oppose higher taxes to spare their supporters further financial pressure as the U.S. seeks to choke off its funding through sanctions on its members and its patron, Iran.If the government survives, few observers expect it to overcome the divisions that have frustrated public demands for change.Foreign Minister Gebran Bassil, the son-in-law of the president and an opponent of Hariri, called for urgent measures to fight corruption and warned in a televised address that the collapse of the government would result in “chaos” and undermine the currency peg.Hariri, who canceled a cabinet session planned for Friday, is expected to deliver an address to the nation at 6 p.m. local time.Persistent instability in Lebanon has shaken investor confidence and made it harder to revive an economy already struggling to absorb more than 1.5 million Syrian refugees who have fled the crisis in neighboring Syria.The yield on Lebanon’s dollar bonds due in 2021 jumped more than two percentage points to 20.38% as of 10:44 a.m. in London, snapping six days of declines. The cost of insuring Lebanese debt against default climbed, with the nation’s five-year credit-default swaps rising 87 basis points to 1,262 -- the highest level on a closing basis since the start of the month.‘Revolution’Sporadic demonstrations have erupted for months in Lebanon as the economic crisis has led to shortages of dollars and threatened the pensions of retired soldiers.The government is under pressure to cut spending, raise taxes and fight corruption -- conditions required by international donors to unlock some $11 billion in pledges made at a Paris conference in early 2018. But the measures are proving deeply unpopular with the public, which widely blames institutional corruption, nepotism and profiteering by politicians for bankrupting the government.The latest unrest was sparked by plans to impose a fee of 20 U.S. cents on the first WhatsApp call that users make every day, causing outrage in a country where communications costs are among the least competitive in the region and people widely use internet voice applications to save money. WhatsApp, a free messaging and voice platform owned by Facebook Inc., has some 1.5 billion users worldwide.On Thursday, the government also discussed a proposal for a gradual increase to the value-added tax, currently at 11%, and new levies on gasoline. But Finance Minister Ali Hasan Khalil insisted there were no additional taxes planned for next year’s budget.As protests spread to the suburbs and provinces, Telecom Minister Mohamed Choucair called LBCI television on Thursday to say Hariri had ordered him to cancel the levy on Internet calls. But the reversal came too late to appease public opinion.Walls of burning tires and debris effectively severed the main thoroughfares at the northern and southern entrances of Beirut and crowds also headed toward the presidential palace in Baabda, footage aired on Lebanese television stations showed. In downtown Beirut, protesters threw bottles, petrol bombs, metal barriers and other projectiles at riot police and occasional scuffles broke out as they tried to break through the security cordon around the government headquarters.The International Monetary Fund projects Lebanon’s current-account deficit will reach almost 30% of gross domestic product by the end of this year. Amid the violence on Thursday, it issued a new report predicting that economic growth, stagnant at 0.3% in 2018, would continue to be weak amid political and economic uncertainty and a severe contraction in the real estate sector. Public debt is projected to increase to 155% of Gross Domestic Product by the end of 2019, it said.(Updates throughout, adds quotes from Basil.)\--With assistance from Alex Nicholson.To contact the reporters on this story: Lin Noueihed in Beirut at lnoueihed@bloomberg.net;Dana Khraiche in Beirut at dkhraiche@bloomberg.netTo contact the editors responsible for this story: Lin Noueihed at lnoueihed@bloomberg.net, Mark WilliamsFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.


Chinese Nuclear Stockpile Clouds Prospects for U.S.-Russia Deal

Yahoo World News Feed - October 18, 2019 - 8:36am

(Bloomberg) -- A key hurdle to extending a landmark nuclear treaty between the U.S. and Russia isn’t Donald Trump or Vladimir Putin. It’s China.The New START treaty, the last major arms control accord between the world’s two nuclear superpowers, is set to expire in early 2021. Like another key treaty covering intermediate-range nuclear missiles, which collapsed this year after the U.S. quit that accord, Trump administration officials say the agreement may not be worth extending if China isn’t brought into the fold.A failure to renew or extend the accord would mark the effective end of decades of agreements aimed at limiting the proliferation of nuclear weapons. Experts say it would also send a worrisome signal to other nations -- from Saudi Arabia to North Korea -- already pursuing or seeking to pursue nuclear programs.U.S. Defense Secretary Mark Esper said in August that the U.S. should consider “multi-lateralizing” the agreement. “If we really want to go after avoiding an arms race, and capture these systems, we should multi-lateralize it.”Yet while the U.S. believes China will double its nuclear stockpile over the next decade, most arms control experts say it would be better for Washington and Moscow to settle on an extension of New START and worry about Beijing later.“China doesn’t have anything like the number of warheads the U.S. and Russia possess,” Sam Nunn, a former Democratic senator from Georgia who co-chairs the Nuclear Threat Initiative, said in an interview. “We will at some point have to have China in the equation but that won’t happen now. Common sense would be to at least extend a treaty that already exists and work from there.”Russian officials say they want the current agreement extended for the allowed five years beyond its 2021 expiration. Foreign Minister Sergey Lavrov told reporters last month that that the U.S. continues to insist China be brought into negotiations, a message he said Secretary of State Michael Pompeo delivered to him at the annual United Nations General Assembly meetings.But Moscow says time is running out. Negotiations for a new deal would typically take as long as a year. Even settling on an extension would be lengthy.“We urge our American colleagues not to lose time anymore,” Russian Deputy Foreign Minister Sergei Ryabkov said in an interview with Russia’s International Affairs journal. “There’s almost none left. Simply letting this treaty die would be unforgivable. This will be perceived by the international community as neglecting one of the key pillars of international security.”Despite American efforts, Beijing has so far balked at trilateral talks, arguing it is far behind Moscow and Washington, which together hold more than 90% of the world’s nuclear weapons.“China has no interest in participating in a nuclear-arms-reduction negotiation with the U.S. or Russia, given the huge gap between China’s nuclear arsenal and those of the U.S. and Russia,” said Fu Cong, director general of the foreign ministry’s Arms Control Department. “The U.S. and Russia, as the countries possessing the largest and most advanced nuclear arsenals, bear special and primary responsibilities on nuclear disarmament.”Nine countries possess nuclear weapons, with the global nuclear warhead count at 13,865 in 2018, according to the Stockholm International Peace Research Institute. Russia and the U.S. each have more than 6,000 warheads, followed by France at 300, China at 290, the U.K. at 200, India and Pakistan each with over 100, Israel at about 80 and North Korea estimated at 20-30.China’s stockpiles are expected to grow rapidly. The country “has developed a new road-mobile intercontinental ballistic missile, a new multi-warhead version of its silo-based ICBM, and a new submarine-launched ballistic missile,” Lieutenant General Robert Ashley, director of the Defense Intelligence Agency, said in May. “With its announcement of a new nuclear-capable strategic bomber, China will soon field their own nuclear triad, demonstrating China’s commitment to expanding the role and centrality of nuclear forces in Beijing’s military aspirations.”Getting China to participate in any talks is complicated by Beijing’s own calculus, which involves deterring India and expanding its weapons program, said Gary Samore, a former U.S. senior director for nonproliferation and export controls during the Clinton administration.“A trilateral approach is not practical at the moment because the Chinese will not agree to institutionalize their very small numbers compared to the U.S. and Russia,” added Samore, who now directs the Crown Center for Middle East Studies at Brandeis University.The demise of the Intermediate-Range Nuclear Forces Treaty, or INF -- the Cold War-era agreement that expired this year -- is already raising tensions with Beijing. Esper recently indicated that the U.S. was looking at deploying previously-banned intermediate range missiles in Asia, angering Chinese officials. Potential bases for the missiles could be in Taiwan and Japan, Samore said.Beyond China, U.S. talks with Russia are complicated by increasing mistrust on both sides. As a UN disarmament committee sought to begin its scheduled meetings earlier this month, Russian officials wouldn’t agree to adopt the schedule in protest of a U.S. refusal to issue visas to members of its delegation, a diplomat said.The potential of an escalating arms race comes after a prolonged period of relative progress in curbing nuclear weapons.The U.S. and Russia destroyed thousands of ground-launched missiles thanks to the INF treaty. New START, reached between Presidents Barack Obama and Dmitry Medvedev in 2010, capped the total number of U.S. and Russian nuclear stockpiles. Crucially, after reaching that accord, the U.S. and Russia adopted a united stance against Iran’s nuclear weapons program, forcing Tehran to sign a 2015 nuclear accord that the U.S. withdrew from last year.Unlike the situation during the Cold War, the advent of new cyber, artificial intelligence, and space technologies has moved much of the nuclear arms competition in recent years away from quantity to quality, Nunn and Ernest Moniz, the former U.S. Energy secretary and the co-chair of the Nuclear Threat Initiative, recently warned in a report. That may bolster the U.S. case for China to be included in a future deal.China’s rising military and technological prowess in the decades since the first nuclear deals were ratified means the Trump administration is right in calling China to be included in new strategic talks, even if it remains in the U.S. interest to extend New START, said Robert Manning, a senior fellow at the Atlantic Council.“The U.S. has historically dominated many emerging technologies such as space, but now the Chinese are growing in these areas,” Manning said. “We need strategic dialogue to tackle these new areas. Do we want autonomous weapons or not? Do we want to ban hyper-sonics or not? That’s where the next wave is, not in whether nuclear weapons should be reduced or not.”But losing New START would send a signal to the world that the two biggest nuclear powers don’t care about arms control, Nunn said. Lori Esposito Murray, an adjunct senior fellow at the Council on Foreign Relations, agrees.“You don’t throw out the baby with the bathwater,” Murray said. “You keep the constraints you have that have produced an 80% reduction of nuclear stockpiles and then you look at a process that looks at China and advanced technologies.”(Updates to add estimated global arsenal in 12th paragraph. An earlier version of this story was corrected to say Nunn is from Georgia, not North Carolina)\--With assistance from Henry Meyer and Brendan Scott.To contact the reporter on this story: David Wainer in New York at dwainer3@bloomberg.netTo contact the editors responsible for this story: Bill Faries at wfaries@bloomberg.net, John HarneyFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.


Pound Levels to Watch After U.K. Lawmakers Vote on Brexit Deal

Yahoo World News Feed - October 18, 2019 - 8:29am

(Bloomberg) -- Currency markets are likely to react sharply to the vote in Britain’s Parliament on Saturday on Prime Minister Boris Johnson’s Brexit deal.With the pound being the main barometer to the ups and downs of the Brexit saga, here is a guide to the levels to watch when markets reopen at the end of the weekend.Bullish OutcomeThe first key pound technical resistance comes around $1.3150 and may be where a knee-jerk rally will stall; the 200-weekly moving average stands at $1.3159, while the midpoint of sterling’s losses since April 2018 comes at $1.3168 and its May 6 high is at $1.3185The next big stop doesn’t come until closer to $1.3400; the mid-March high at $1.3381 stands out, while the pivotal 61.8% Fibonacci retracement of the 2018-2019 downtrend comes at $1.3453 and a four-year trendline resistance currently stands above $1.3500Bearish OutcomeInvestors short the pound may be looking to trim their exposure around the $1.2600 area; the 38.2% Fibonacci retracement of the recent rally comes at $1.2596, with October’s breakout point seen at $1.2582, the high on Sept. 20; a key DeMark trendline comes at $1.2522 The next potential barrier comes below $1.2400; the July 17 low at 1.2382 is in close proximity to $1.2353, the 61.8% Fibonacci level of the latest rally A triple-bottom in October around $1.2200 also stands out, while at the far end lies a 31-year low at $1.1841, the 2016 troughRangebound OutcomeIn case the pound fails to sustain a big move in either direction, short-term levels to watch for include pivot resistance at $1.3004; $1.2990, the high on Oct. 17; $1.2765, pivot support; and $1.2712, the 233-daily moving averageNOTE: Vassilis Karamanis is an FX and rates strategist who writes for Bloomberg. The observations he makes are his own and are not intended as investment adviceTo contact the reporter on this story: Vassilis Karamanis in Athens at vkaramanis1@bloomberg.netTo contact the editors responsible for this story: Paul Dobson at pdobson2@bloomberg.net, Neil Chatterjee, Michael HunterFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.


Brexit Defeat Would ‘Suck The Wind’ Out of Sterling’s 5% Rally

Yahoo World News Feed - October 18, 2019 - 8:24am

(Bloomberg) -- Currency strategists are ruling nothing out for Saturday’s crucial parliamentary vote on Britain’s deal to exit the European Union -- and that makes forecasting where sterling will trade something of a crapshoot.The pound could surge to $1.35 or slip to around $1.22, strategists and fund managers say as they assess the range of possible outcomes from Brexit’s climactic moment.Sterling already jumped 5% this month to around $1.29 and now it’s pinned to that marker as traders wait to see if Prime Minister Boris Johnson can convince skeptics in the House of Commons to approve the divorce deal he sealed this week. It’s fine margins, and if he can’t, that opens the door to other scenarios including an election, a second referendum, or even a move to leave the EU with no agreement in place.While Johnson’s accord has lowered the likelihood of a no-deal Brexit on Oct. 31, the risks “are not mathematically zero,” say strategists at Toronto-Dominion Bank, including Ned Rumpeltin.“Any positions predicated on an imminent no-deal crash-out look difficult to countenance at this stage,” said Rumpeltin, the European head of currency strategy at TD. “Looking forward however, we think it is still a little too early to sound an unqualified all-clear.”If Parliament does manage to pass the deal this week, the pound could test May’s peak of around $1.3185, the TD strategists forecast, though they see it struggling to move higher in the absence of fresh catalysts.UBS Global Wealth Management is more bullish. It’s retaining an overweight position in sterling against the dollar, said Chief Investment Officer Mark Haefele. A “convincing deal” could drive the pound to $1.35, he predicted.Johnson needs 61 of 85 possible votes from potential swing lawmakers, a tight but feasible number. One blow is that Northern Ireland’s Democratic Unionist Party, with 10 potential supporters, came out firmly against the deal.If lawmakers were to reject it and that led to an extension beyond the Oct. 31 Brexit deadline, the risk of a general election would “suck the wind” out of sterling’s rally and see it test $1.2640-60, the TD strategists predict. And that level could come under significant pressure if Parliament’s blocking of the deal were followed by the EU rejecting a request for an extension to the Brexit deadline.Jane Foley, the head of currency strategy at Rabobank, sees even greater risks if the deal fails to pass through Parliament. Sterling could dip to around to October’s low of $1.22 before finding “solid support” -- as long as the government doesn’t ramp up its no-deal rhetoric, she said.Other scenarios -- including a potential second referendum that could cancel Brexit altogether, or a delay in the timing of the vote -- cannot be ruled out either.No wonder implied volatility on sterling is so high and risk gauges are swinging back and forth. And adding to the drama, the currency market won’t get its first chance to react to the twists and turns of the weekend until trading resumes at 7 p.m. local time (or 7 a.m. in Auckland), when liquidity can be limited and exacerbate price swings.“No deal remains a threat until either a deal or no Brexit is completed,” Rumpeltin said. “An unexpected jump to an alternative scenario would quickly return both rates and FX to the state of confusion and -- often -- contradiction that has defined much of the Brexit process so far.”(Adds Rabobank view in 10th paragraph, updates chart)To contact the reporter on this story: Anooja Debnath in London at adebnath@bloomberg.netTo contact the editors responsible for this story: Paul Dobson at pdobson2@bloomberg.net, Neil ChatterjeeFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.


Syria Kurds accuse Turkey of violating cease-fire

Yahoo World News Feed - October 18, 2019 - 8:21am

The Kurdish-led administration in northern Syria accused Turkey on Friday of violating a U.S.-brokered cease-fire that went into effect overnight, as fighters from both sides clashed in and around a border town that has been one of the fiercest fronts in the Turkish invasion. The town of Ras al-Ayn was emerging as an immediate test for the five-day cease-fire agreed on by Washington and Ankara. Before the deal's announcement, Turkish-backed forces had encircled the town and were battling fierce resistance from Kurdish fighters inside.


EU Leaders Fail to Make Headway on Their Trillion-Euro Budget

Yahoo World News Feed - October 18, 2019 - 7:55am

(Bloomberg) -- After managing a united front over Brexit, divisions between European Union leaders were laid bare Friday when they discussed how to plug the budget shortfall left by the U.K.’s intended departure.The trillion euro ($1.1 trillion) seven-year budget is a cornerstone of EU policy that lets farmers compete against imports from the developing world, helps poorer states catch up with the rich ones and underpins projects that bind the union together. But agreeing on the amount of cash and how to spend it is a regular source of tension between the net contributors and those who get more than they put in.Britain, of course, was a net contributor. Now richer members are calling for the hole it will leave to be covered by cuts in the budget for the 2021-2027 period. Poorer ones want everyone else to cough up more.During their meeting on Friday leaders didn’t make any headway in agreeing on a ceiling for the budget, putting at risk a self-imposed deadline to reach a final deal in December. Agreement on the volume of the funds is needed before decisions can be taken on what they should be spend it on, and the conditions attached to the disbursements.But so far, diverging positions between different countries have remained entrenched."Positions on the budget were significantly apart," said Lithuanian President Gitanas Nauseda "Divergence of opinion was too big to find a compromise today."European Commission President Jean-Claude Juncker said the discussion didn’t offer any guidance as leaders just repeated known positions and predicted there would be no breakthrough in December either."We’re under time pressure," German Chancellor Angela Merkel said. "We have to quickly reach an agreement under the Croat presidency if possible, otherwise we won’t be able to finalize the programs by the time the new financial framework takes effect -- which wouldn’t be good."No One Is HappyThe spat is expected to keep leaders at loggerheads for months, but at its heart it’s about a tiny amount of money when spread over the EU’s 450 million people: 0.1% of GDP. The bloc’s executive arm has proposed that member states commit around 1.1% to the joint budget, while net contributors want to cap that at 1%. Either way it’s not much more than they have put in previously.Finland, which holds the rotating presidency of the EU, has proposed 1.03% to 1.08%, according to an internal memo. The difference between those figures amounts to about 50 billion euros over seven years. Yet almost no one is happy, according to several diplomats following the issue.The EU is no stranger to fighting over small change.The 19 finance ministers representing the euro-area’s $19 trillion economy just completed a two-year negotiation over a separate budget worth less than 20 billion euros.(Updates with Nauseda and Juncker comments in six, seventh paragraphs.)\--With assistance from Milda Seputyte, Jan Bratanic, Aaron Eglitis, Lyubov Pronina, Stephanie Bodoni, Morten Buttler, Jonathan Stearns, Helene Fouquet, Ewa Krukowska, Alexander Weber, John Follain, Richard Bravo and John Ainger.To contact the reporters on this story: Nikos Chrysoloras in Brussels at nchrysoloras@bloomberg.net;Viktoria Dendrinou in Brussels at vdendrinou@bloomberg.netTo contact the editors responsible for this story: Chad Thomas at cthomas16@bloomberg.net, Ben Sills, Rosalind MathiesonFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.


EU finance sector prepared for hard Brexit, if deal fails- Scholz

Yahoo World News Feed - October 18, 2019 - 7:35am

German Finance Minister Olaf Scholz on Friday said he hoped the British parliament approved an agreement for Britain's departure from the European Union, but said the EU was prepared to weather a no-deal Brexit if necessary. Scholz said there would be no significant impact on the financial sector, but sorting out complex supply chain issues could be more difficult if Britain crashed out of the bloc without a deal. "We are prepared for that," Scholz told an event hosted by the Council on Foreign Relations think-tank.


Boris Johnson seeks to charm parliament — with his eye on an election

Yahoo World News Feed - October 18, 2019 - 7:29am

Boris Johnson will fire up the charm in an attempt to push his Brexit deal through the U.K. parliament — but crushing failure followed by an election could be no bad thing. Johnson already started greasing the wheels on Thursday after he clinched a surprise agreement with Brussels and jetted to the European Council summit in Brussels to get it rubber-stamped by EU leaders. Saturday's vote is the crucial next stage in the Brexit process, but an expected defeat in the House of Commons coupled with the win from Brussels could hand him a tailor-made election campaign pitch to take to the public: Parliament blocked my deal and refused to deliver Brexit, so give me more MPs to get it done.


Sudan rebel faction, government hold 1st round of talks

Yahoo World News Feed - October 18, 2019 - 7:27am

Sudan's largest single rebel group Friday held its first round of direct peace talks with the country's transitional government, despite an earlier boycott following a military crackdown. The Sudan Liberation Movement-North, led by Abdel-Aziz al-Hilu, had canceled talks with the government that were scheduled for Wednesday after the paramilitary Rapid Support Forces set up a checkpoint and detained 16 people in South Kordofan Province.


Macron says opposes Brexit extension if UK parliament rejects deal

Yahoo World News Feed - October 18, 2019 - 7:04am

French President Emmanuel Macron said on Friday that he was opposed to granting a Brexit extension past the Oct. 31 deadline if the British parliament rejects the deal agreed with the 27 other EU member states. The House of Commons is due to vote on Saturday on the agreement reached between the 27 and British Prime Minister Boris Johnson. "I hope we can stick to the timeline we gave ourselves and that the date of Oct. 31 is respected," Macron told a news conference.


Trump hails Syria cease-fire after he played role in crisis

Yahoo World News Feed - October 18, 2019 - 6:56am

President Donald Trump framed the U.S.-brokered cease-fire deal with Turkey as "a great day for civilization," but its effect was largely to mitigate a foreign policy crisis widely seen to be of his own making. After hours of negotiation in Ankara, the two nations Thursday agreed to a five-day cease-fire in the Turks' deadly attacks on Kurdish fighters in northern Syria, but some fighting continued early Friday in a northeast Syrian border town. The Kurds were U.S. allies in the fight against the Islamic State group but came under assault after Trump ordered U.S. troops to leave the area earlier this month.


Pakistan avoids terror financing blacklist _ for now

Yahoo World News Feed - October 18, 2019 - 6:51am

An international monitoring agency has given Pakistan four months to prove it is fighting terrorism financing and money laundering — or it could be put on a damaging global blacklist. The Financial Action Task Force also threatened Iran, which is already blacklisted, with even tougher restrictions on its international financial activity. Pakistan's government on Friday hailed the FATF's decision, which offers a reprieve to Prime Minister Imran Khan as he works to shore up his country's faltering economy and attract foreign investment and loans.


Britain will lose out from exiting single market - Merkel

Yahoo World News Feed - October 18, 2019 - 6:38am

German Chancellor Angela Merkel said Britain would become a competitor after Brexit and that its exit from the European Union would see it losing out. Merkel told a news conference that she felt the competition would be strongest in areas such as research, tax policy and digitalisation, rather than foreign policy. "Great Britain will of course lose out somewhat.


15 Times Trump and His Allies Claimed 'No Quid Pro Quo'

Yahoo World News Feed - October 18, 2019 - 6:17am

WASHINGTON -- It was not the message that the White House and its supporters have been trying to hammer home in recent weeks as the impeachment investigation has intensified on Capitol Hill: Mick Mulvaney, the acting White House chief of staff, said Thursday that President Donald Trump withheld military aid to Ukraine in part to pressure Kyiv to pursue a politically motivated investigation into the 2016 election.His comments -- even after he issued a statement walking back his remarks -- undercut weeks of denials from Trump, his aides, Republican lawmakers and the conservative news media that the president was seeking a quid pro quo in his dealings with the new Ukrainian president. Some of their statements were focused on a July 25 phone call between Trump and the president of Ukraine in which Trump repeatedly brought up his desire for investigations into political rivals. Others touched specifically on Trump's decision in July to hold up the $391 million package of security aid to Ukraine, a development that government officials there said they only learned about at the end of August.OCT. 16, 20191\. President Donald Trump"Now, all of a sudden, quid pro quo doesn't matter because now they see, in the call, there was no quid pro quo."-- In remarks at the White HouseThe New York Times also found several other instances of Trump's proclaiming "no quid pro quo" on Twitter, in remarks to reporters, in news conferences and at political rallies.OCT. 3, 20192\. Vice President Mike Pence"Contrast that with the president's -- the transcript of the president's phone call with President Zelenskiy where there was no quid pro quo. There was no pressure."-- In remarks to reportersOCT. 3, 20193\. Rep. Mark Meadows, R-N.C."What we do know is there was definitely no quid pro quo. I mean, it came out over and over."-- In remarks to reportersOCT. 13, 20194\. Treasury Secretary Steven Mnuchin"In the Oval Office, when the president was asked about this in front of the vice premier, the president made very clear, they can do what they want. So, again, people who are trying to imply that the president is asking for things or quid pro quos, I think this is ridiculous."-- In an interview on ABCOCT. 4, 20195\. Lou Dobbs, Fox Business Network host"And it's not a difference of opinion. Any rational person looking at it, any reasonable person, can only conclude that there was no quid pro quo. There was no threat of any kind."-- on Fox NewsSEPT. 28, 20196\. Kellyanne Conway, counselor to the president"And as the president said, this was a perfect call. The Ukrainian president said on live TV the other day, up at the United Nations General Assembly, that he felt no pressure. And, in fact, if you read what's there, you see what's not there -- no quid pro quo."-- In an interview on Fox NewsSEPT. 26, 20197\. Larry Kudlow, Trump's chief economic adviser"There was no quid pro quo. There was no issue about finally getting the military assistance. And he thanked us. The Ukrainian president thanked us for our support on his anti-corruption campaign."-- In an interview on Fox NewsOCT. 14, 20198\. Rep. Steve Scalise, R-La."And I think a lot of these members in swing districts are hearing that, hey, you ran saying you were going to work with people to get things done and all you're focused on is impeaching the president over a lie about quid pro quo that never even happened. What are you people doing up there?"-- In an interview on Fox Business NetworkOCT. 14, 20199\. Rep. Lee Zeldin, R-N.Y."President Zelenskiy had no idea that there was a hold on aid during the July 25th call. The readouts of the July 25th call on both the Ukraine side and the U.S. side mention nothing about a hold on aid or a quid pro quo. July 26th, the day after that phone call, Ambassador Volker met with President Zelenskiy. During that meeting, there was no reference to a hold on aid or a quid pro quo."-- In remarks to reportersOCT. 13, 201910\. Sen. Kevin Cramer, R-N.D."There was no quid pro quo in the -- in the phone conversation. So, no doubt that the haters are going to hate."-- In an interview on CNNOCT. 13, 201911\. Sen. Ted Cruz, R-Texas"I think that was good because a lot what the Democrats had been raising, alleging an illegal quid pro quo, was not, in fact, backed up by the transcript."-- In an interview with CBSOCT. 8, 201912\. Rep. Jim Jordan, R-Ohio"If they would release the transcript from Ambassador Volker's testimony and interview last week, you would see that Ambassador Volker backs up exactly what you just said. There was no quid pro quo."-- During an interview on Fox NewsOCT. 6, 201913\. Sen. Lindsey Graham, R-S.C."Every Democratic member of the House needs to be on record: Do you agree with Nancy Pelosi that the transcript is enough to impeach President Trump? Remember when Pelosi said that the transcript would show a quid pro quo? It doesn't."-- In an interview on Fox Business NetworkOCT. 8, 201914\. Mercedes Schlapp, senior adviser for the Trump campaign"But more so, what is so disgusting is the fact that the Democrats continue to try to build up this narrative on, well, there was a quid pro quo when the call -- when the call happened. They just jumped the gun without facts, without being credible."-- In an interview on Fox Business NetworkOCT. 2, 201915\. Hogan Gidley, White House spokesman"Well, right. But this doesn't have anything to do with the 2020 election, and the president was very clear about that and that wasn't in the call. What else wasn't in the call was the quid pro quo."-- In an interview on Fox NewsThis article originally appeared in The New York Times.(C) 2019 The New York Times Company


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