May Appoints Little-Known Junior Minister To Brexit Secretary Post

Update (12:15 pm ET): Echoing reports from earlier, more reporters are claiming that the EU is considering reopening the Brexit backstop - presumably in an effort to resolve Brexiteers' concerns about the UK being trapped in the customs union indefinitely.

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Update (12 pm ET): The 'no contest' letter count is slowly rising: At least 22 Tory MPs have publicly said they’ve either submitted or will submit letters of no confidence in UK.

  • Jacob Rees-Mogg
  • Mark Francois
  • John Whittingdale
  • Steve Baker
  • Henry Smith
  • Simon Clarke
  • Anne Marie Morris
  • Lee Rowley
  • Sheryll Murray
  • Martin Vickers
  • Adam Holloway
  • Ben Bradley
  • Maria Caulfield
  • Chris Green
  • Marcus Fysh
  • Submitted previously:
  • Nadine Dorries (some weeks ago)
  • Laurence Robertson (a few months ago)
  • Andrew Bridgen (July)
  • Andrea Jenkyns (June)
  • Peter Bone (Submitted some time ago)
  • Philip Davies (July)
  • James Duddridge (a month ago)

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Update (11:30 am ET): Those who speculated that May might assume the role of Brexit Secretary herself were half-right.

Theresa May has appointed pro-Brexit MP Stephen Barclay, previously the minister of state at the department of health and social care, as her new Brexit minister. However, May is stripping the Department for Exiting the European Union of its primary responsibility and taking charge of Brexit negotiations herself.

Barclay is set to become May's third Brexit secretary in 6 months following the resignations of David Davis (who quit over Chequers) and Dominic Raab (who quit on Thursday over the draft plan).

Barclay

Previously a little-known junior minister, Barclay is the second addition to May's cabinet on Friday. He was a former director at Barclays bank, per the Guardian.

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Update (11 am ET): In an appointment that is nothing short of revelatory in terms of May's shifting tactics surrounding Brexit, Amber Rudd will be returning to May's cabinet to replace Esther McVey as pensions secretary. Rudd resigned from the cabinet in April following a controversy over deportation targets.

And as fate would have it, Rudd has previously expressed some opinions that likely won't be too well-received by members of the ERG.

Does this suggest that May might be looking to Labour to shore up her plan, using a second referendum as an enticement?

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Update (9:30 am ET): With just minutes to go before US cash trading opens, Bloomberg has shattered the peace created by reports that no more cabinet resignations would follow on Friday.

Commons leader Andrea Leadsom is reportedly convening a group of five key cabinet ministers who are hoping to force a change of the Brexit draft plan.

And if they can't?

A mass walkout would be likely in the run-up to May's "meaningful vote."

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Update (8 am ET): The pound is spiking heading into the US trading day, moving back above $1.28, as the anxieties over a potential leadership challenge and mass exodus of May's cabinet.

Some encouraging developments in the late morning: Parliment chief whip has canceled a meeting with lawmakers about the Brexit deal, according to Buzzfeed. And in an encouraging sign that the EU and the UK might be able to iron out some of the more controversial aspects of the backstop,  EU ministers are expected to focus on changing the wording of the deal to stop it from potentially binding the UK to the customs union "indefinitely". This would ameliorate the biggest concern voiced by intransigent Tory MPs.

GBP

Still, the confusing contradictory reports about a 'no confidence' vote have continued:

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Update (7:15 am ET): As reports out of Westminster suggest that the threshold for a 'no confidence' vote in Theresa May has been reached, No. 10 insists that it hasn't.

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Update (7 am ET): Tory MP Steve Baker says his list of no-confidence letters suggests that the 48-vote threshold has been reached, with perhaps another 12 coming in on top of that.

Though it's impossible to say for sure because people are "sometimes coy".

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Update (6:30 am ET): As of 11:30 London Time on Friday, the count for publicly disclosed letters of no confidence in May submitted to the conservatives' 1922 committee stands at 20...the threshold for calling a vote is 48.

Brexiteers understand that they probably wouldn't win a no confidence vote. But their plan is to use the vote to demonstrate to May that her draft plan wouldn't pass in the Commons. More conflicting reports about whether the European Research Group has passed the 48-letter threshold circulated on Friday. But the only man who knows for sure is Tory kingmaker Graham Brady, the MP in charge of the Tory's 1922 committee.

Here's a list of MPs who have submitted, or said they plan to submit, letters of no confidence (courtesy of BBG):

  • Jacob Rees-Mogg
  • Mark Francois
  • John Whittingdale
  • Steve Baker
  • Henry Smith
  • Simon Clarke
  • Anne Marie Morris
  • Lee Rowley
  • Sheryll Murray
  • Martin Vickers
  • Adam Holloway
  • Ben Bradley
  • Maria Caulfield

Submitted previously:

  • Nadine Dorries (some weeks ago)
  • Laurence Robertson (a few months ago)
  • Andrew Bridgen (July)
  • Andrea Jenkyns (June)
  • Peter Bone (BBC - submitted some time ago)
  • Philip Davies (July)
  • James Duddridge (a month ago)

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As May scrambles to stop any further resignations, No. 10 Downing Street insists that there will be a new Brexit secretary by the end of the weekend. Some have even suggested that May should take on the role in addition to her prime ministerial duties. Others have speculated that Trade Secretary Liam Fox would be the logical candidate.

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After what was presumably a "long night of the soul" for Environment Secretary Michael Gove, the Tory cabinet minister has decided to split the difference in terms of decisions that would disappoint and delight his boss, Prime Minister Theresa May. He won't take the Brexit Secretary post vacated on Thursday by Dominic Raab. But - for now, at least - the "tortured" Gove won't be resigning, according to the London Times.

Though some sources said he could still quit by the end of the weekend.

But that was about all of the good news for May, who is facing another brutal day of trying to rally fractured Tories behind what she firmly insists is the 'best deal possible.' Shortly after former culture secretary John Whittingdale became the latest Tory to announce he had submitted a letter of no-confidence in May, the embattled prime minister did the next logical thing: She sat for a 30-minute radio interview where she continued to try and sell her deal and insisted she would carry on as prime minister.

Following the interview, which received mixed reviews and which ended with a question comparing May with Neville Chamberlain, the prime minister was confronted with reports that the 1922 committee (the private committee for the Conservative Party in the House of Commons) had received the requisite 48 letters to call for a 'no confidence' vote in May. According to media reports, the vote could happen in the coming days (though, in a repeat of the drama from Thursday, those reports were swiftly refuted).

Amid all these news, the GBPUSD has been pegged firmly against 1.28, waiting for any major news to break one way or the other.

Circling back to Gove, looked chipper this morning as he confronted the horde of reporters lurking outside his London home.

Gove

The scrutiny was understandably intense, with CNN offering this trenchant analysis of the 'breakfast indicator'.

It appears that Michael Gove is carrying a paper bag from Patisserie Valerie, a British cafe chain that's in deep financial trouble. Is this a subtle message? Its chief executive resigned on Thursday. His name? (Paul) May.

And as one reporter noted: "stranger things have happened."

And although May has insisted that a "People's Vote" on the deal (which would function as effectively a second Brexit referendum) won't happen, Labour MPs insist that such a vote is growing increasingly likely (as their chances of seizing power grow). Tom Watson, Labour's deputy leader, has said a fresh referendum on Brexit is now "more likely," according to the Independent.

With Gove sticking around, reporters are turning their attention to another restive senior member of May's government: International Development Secretary Penny Mordaunt. Approached about her resignation plans this morning, Mordaunt insisted: "I've got nothing to say." Though, according to the latest round of reports, the UK press doesn't expect any more resignations on Friday as Mordaunt and Commons leader Andrea Leadsom have reportedly agreed to stay on.

With UK markets still recovering from the brutality of Wednesday and especially Thursday, Bloomberg has published a handy guide that functioned more like a warning: All of those analysts who projected a drop in the pound below $1.25 if May's deal is ultimately defeated might be conservative. They even invoked the memory of the October 2016 'flash crash'.

But if lawmakers reject the deal, the currency vigilantes may re-emerge en masse over the low-liquidity Christmas period, ratcheting up pressure on a divided Parliament. Remember the 6% flash crash in October 2016 when the pound was pummeled in just one minute in thin Asian trading?

But it wouldn't even take an outright rejection of the deal to reawaken the 'currency vigilantes'. Indeed, as anybody who has been watching the tape probably could guess, they are already with us.