After a much needed break from Brexit drama, the U.K. parliament is back in session to get the debates going this week. What might happen this time?
In the absence of top-tier U.K. economic releases this week, the attention could be focused on Brexit developments as the British parliament returns from its holiday recess.
The usual back-and-forth could come in play, but there’s less downside pressure on sterling this time since PM May was granted an extension by the EU until the end of October. Any signs of a possible compromise could spur some gains.
Another aspect that could be in focus for pound pairs this week is the anticipation for the local elections on May 2.
These elections are set to take place across 248 councils in England, and Conservatives hold a majority of the 8,425 seats contested. With the prolonged Tories mess that is Brexit, the opposing Labour party might have a chance to snag a few more seats.
A big defeat for Tories could ramp up the pressure for PM May to step down, and surveys this week could provide some clues on how the actual local elections could turn out.
Still, even with these political uncertainties, it’s worth noting that economic data came in mostly stronger than expected to show that the rest of the U.K. is keeping calm and carrying on.