Summary for the 15th of January 2019


The highlight of this week in economics is probably the voting in the British parliament for the Brexit deal. The voting will be happening at around 20:00 GMT+1 tonight. It was planned to be on the 12th of December, but the British Prime Minister, Theresa May had postponed it. She knew the deal wouldn’t get approved in the British parliament, and she wanted to negotiate with the EU further about the backstop solution.

The renegotiation with EU didn’t go so well. The EU didn’t want to renegotiate the deal, and May had to get the support from the MPs in the British parliament. So far it seems like she hasn’t been able to get enough support for the approving of the deal. The Labour Party expresses a downvote of the deal, because the party wants an opportunity to themselves renegotiate a better deal. The Conservatives Party also expresses a downvote of the deal, because they want a harder Brexit deal. The Democratic Unionist Party also expected to downvote the deal. The exact result of the voting might vary, depending on other amendments in the deal that the parties will be voting over.

The British parliament adopted a plan where if the Brexit deal doesn’t go through, May would have three days to present a new plan, a plan B. When plan B is presented, the British parliament will have the opportunity to suggest options in the plan B. This could be new referendum for a similar deal like between the EU and Norway.

Other alternative if the deal gets downvote could be that May renegotiates with the EU again, and Brexit deal gets postponed to the summer. So the Brexit uncertainty still looms.

The industrial production in the EU fell by -1.7% in November, month over month. The decline was larger than the market expected. The trend is now negative, but some of the decline is explained by the decline in vehicles production in Germany, due to their new emission regulations, thus the decline production should only be temporarily. German industrial production fell by -1.9% in November, other major countries industrial production fell between  -1.3% and -1.6%

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