This means the UK will not leave the bloc without a deal on Thursday and lent GBP modest support. However, a longer delay means further Brexit uncertainty. As Deloitte’s global Brexit lead Amanda Tickel stated: “While there is relief that the disruption of a no-deal exit on 31 October is off the table, further delay prolongs uncertainty. Businesses will be wondering what to do with partially implemented restructuring, stockpiles and logistics plans. With the added stepping stone of a possible election in the coming weeks, planning for the future could be even harder.”
Meanwhile, MPs are preparing to vote on Boris Johnson’s proposals for an early general election on 12 December.
While the Prime Minister seems unlikely to gain enough support from MPs in order to pass a motion for an early election, he is expected to continue to push for one.
The Scottish National Party (SNP) and Liberal Democrats have also proposed an early election to take place on 9 December, and an anonymous source from Downing Street said that the government would introduce an “almost identical” bill to the option from the SNP and Lib Dems if Labour voted down their plan.
The source also added that the UK “will have a pre-Christmas election anyway.”
Meanwhile, the single currency edged down against the pound as data revealed that bank lending to companies in the Eurozone fell in September, suggesting that after a period of resilience corporate lending is beginning to slow.
The data suggests that despite the fresh stimulus launched by the European Central Bank (ECB) to encourage banks to provide credit, the banks are taking credit out of the economy.
Looking ahead, the euro could be left under pressure on Tuesday following a speech from German central bank President Jens Weidmann.
If the Bundesbank President mentions the issues facing the bloc’s largest economy, including weaker consumer confidence, the euro could extend its losses against the pound.