UK Prime Minister Theresa May has had two victories this week; one surprising, the other pyrrhic.
It is something of a surprise that she has managed to see off the challenge to her leadership that seemed likely to come following, what were now clearly overblown, claims made by the Brexiteer European Reform Group. In the grand scheme of things, the fact that she will probably now remain in charge until next March when Brexit finally happens is really neither here nor there. She has proven herself to be a formidable character, not quite Thatcher, but maybe Thatcheresque.
The problem is that is unlikely that she can win another election so her tenure may still depend on the outcome of Brexit.
Sterling has not exactly rallied on the back of the deal being done in Brussels, and there are very good reasons for that; first there is still the risk of a veto from Spain over Gibraltar and second, the chances of the deal passing through Parliament are as slim as ever.
If the DUP decide they can no longer support the Government as they clearly have in mind to do following their contribution to the defeat over the Budget earlier in the week, a General Election either just before of just after Christmas will become more probable. It is then that the entire Party rather than Brexiteers will be baying for blood and the 48 letters of no confidence will be reached easily.
Politicians, especially it seems Conservative MP’s have a highly sensitive desire for survival and they will vote for a leader who can win an election, although amongst the current candidates they may do well to find one.
Mrs May is far from out of the woods but she has earned a little respite. As soon as she stands before Parliament if the EU Summit (being held this Sunday), approves she will face every doubt and criticism that has been swirling around her for weeks.
Alan is an award-winning market commentator, providing bespoke content delivery for all aspects of the FX Industry. He has been working in the financial services industry for over 30 years and has a wealth of experience across banks in Europe, North America and the Middle East. A former trader, Alan holds a bachelor of business administration in Politics and Economics from the Mark Hall School.