U.K. Prime Minster Boris Johnson was dealt yet another damaging Brexit blow Thursday with news that his brother, a lawmaker representing one of London's largest suburbs, will resign from the government, citing 'unresolvable tension' between 'family loyalty and the national interest'.
Jo Johnson, a Member of Parliament for Orpington, a suburban district some 20 miles southeast of London since 2010, said he would not seek re-election, noting tensions between his pro-European views and those of his elder brother, Prime Minister Boris Johnson. Johnson also lost his party's House of Commons majority earlier this week when Conservative party lawmaker Phillip Lee crossed the aisle to join the rival Liberal Democrats.
It's been an honour to represent Orpington for 9 years & to serve as a minister under three PMs. In recent weeks I've been torn between family loyalty and the national interest - it's an unresolvable tension & time for others to take on my roles as MP & Minister. #overandout— Jo Johnson (@JoJohnsonUK) September 5, 2019
The move caps a tumultuous week for the PM, who lost three different votes in the House of Commons during his first week on the job, and saw more than 20 of his party colleagues defy threats to sack them as they voted against the government in a bill that would seek to delay his attempts to take Britain out of the European Union -- with or without a bespoke trade deal -- on October 31.
The pound reacted sharply to news of Johnson's late Wednesday defeat in a vote to force a general election on October 15, just days before a make-or-break summit with EU leaders in Brussels, rising to a multi-week high of 1.2333 against the U.S. dollar for its best two-day gain in nearly a year.
Why any sterling gains won't last amid the Brexit chaos. We're looking at EUR/GBP converging to 0.95 within three months and GBP/USD to fall to 1.17 pic.twitter.com/k3iCdNKiW1— ING Economics (@ING_Economics) September 5, 2019
Wednesday's vote will effectively hand Brexit powers to lawmakers by forcing the government to get final approval for any deal -- or any no deal -- through a formal debate and an 'aye or nay' vote. The bill also demands that Johnson seek a third extension to Britain's Brexit deadline, something he has vowed not to do under any circumstances.
The Brexit path ahead could still invoke an election, which could raise the prospects of a no-deal Brexit again in the event that PM Johnson wins a clear majority." said FXTM analyst Han Tan.
"Even the more market-friendly option of delaying Brexit would only serve to kick the can down the road, leaving the Brexit conundrum intact while keeping the Pound subdued," he added. "Prolonged uncertainties surrounding Brexit would only ensure that Sterling remains susceptible to the UK's political risk."