Picture: REUTERS/DADO RUVIC/ILLUSTRATION
Picture: REUTERS/DADO RUVIC/ILLUSTRATION

The rand was flat against the dollar and euro on Wednesday morning, but weaker against the pound, as markets waited for the next Brexit development.

The chances of political and market turmoil have escalated after UK Prime Minister Theresa May was handed a crushing defeat on Tuesday. British legislators rejected her draft Brexit agreement, setting the stage for an extension, another referendum or the UK exiting the EU without a deal.

At 9.45am the rand was flat at R14.3663/$ and unchanged at R16.2144/€. It was 0.36% weaker at R18.8499/£. The euro was flat at $1.1286.

UK MPs are expected to vote on Wednesday on whether or not back a no-deal Brexit. They could also vote on Thursday to request an extension of the March 29 Brexit deadline, but even if this passes, it needs the unanimous consent of all 27 member governments of the EU.

Any extension beyond May 2019, however, would require the UK to participate in the European parliamentary elections, which could delay Brexit even further.

Local factors are taking a back seat, although analysts expect a cautious stance by traders ahead of a review of SA’s credit status by Moody’s Investors Service at the end of March.

gernetzkyk@businesslive.co.za