Closed Brexit live – Gove launches bid as ‘candidate for change’; FTSE has best week since ’11

Britain's Justice Secretary, Michael Gove, delivers his speech after announcing his bid to become Conservative Party leader, in London

The race to be the next prime minister is now in full swing. Michael Gove has launched his campaign to become the next Prime Minister argued that only someone who had campaigned for Brexit should lead the Conservative party; the frontrunner Theresa May campaigned on the Remain side.

Sterling remains lower following Bank of England governor Mark Carney’s comments that the UK was suffering “post-traumatic stress” and the central bank is likely to have to ease policy in the coming months.

As policymakers scramble to respond to the economic shock of the vote to leave, Chancellor George Osborne said that he is dropping his long-held goal of reaching a surplus in the UK’s public finances by the end of the decade.

Key points

  • Michael Gove sets out his bid for Tory party leadership, focus on change and reform

  • Labour leader Jeremy Corbyn could face a leadership challenge

  • George Osborne abandons his 2020 public finance surplus target

  • FTSE 100 enjoys best week since Dec ’11


Welcome back to our live coverage of the fallout from last week’s referendum.


An update on the Tory party leadership race: bookies have Theresa May as the heavy favourite to replace David Cameron, with Andrea Leadsom today pipping Michael Gove into second place.


The front page of this morning’s FT focuses on Bank of England governor Mark Carney’s latest warning about “post-traumatic stress” for the UK economy.

https://twitter.com/FT/status/748597473766219777

Emily Cadman’s story on the governor’s speech from yesterday is our most-read article of the morning.


A spot of local election news overnight – the Liberal Democrats scored a big win in the Leatherhead North council by-election last night thanks to a huge 28 per cent gain in vote share.

The party – which was nearly wiped out in the last general election – has quickly moved to campaign on a pro-European stance and has vowed to take the UK back into the EU.

https://twitter.com/britainelects/status/748652708912046080

It may have been a small vote involving just a few hundred people, but the Lib Dem leader Tim Farron hopes it is the beginning of the party’s renaissance.

https://twitter.com/timfarron/status/748655399193174016


It has been a strong week for letters to the FT on Brexit and UK politics…here is a striking one from this morning:

We are the 48 — and we want our country back

Sir, Roula Khalaf has the story roughly right but she’s missed the most injured demographic (“Post-referendum mourning and the millennial vote”, Notebook June 30). It’s us on Facebook posting memes about Little Britain and Pooh and Piglet. We are the 48 — years old as well as per cent.

We have small houses and large mortgages. We went to raves and we stopped fighting at football matches. We got very drunk one night in 1997 then felt betrayed because of Iraq. We like being European and we understand the world is interconnected and complicated. We thought everyone knew that the headlines about Brussels Being Bananas were just jokes. We didn’t realise anyone took The Sun seriously. We can follow an argument and spot a lie. We have friends in other countries and we’re embarrassed. We feel completely disconnected from half our neighbours and felt the need to apologise in person to our Polish friends at the school gate. We’ve explained to our kids that grandad isn’t really a racist and that we’ll still be allowed to go camping in France.

We are lecturers, nurses, systems analysts and engineers. We are the civil service. We run small businesses. We work for large, foreign-owned companies. We aren’t in charge but we are the backbone of the country. We didn’t go to Eton. We are grown-ups. We can’t leave because our kids are at school and our parents are getting old. We wish that we were Scottish, or Irish. We didn’t prepare ourselves for this because we didn’t believe it could possibly happen.

We’d really like an electable opposition. We want a plan B, a climbdown, a compromise. We want common sense to come back into fashion. We are reduced to posting on Facebook because we haven’t worked out what to do yet. We will. We want our country back.

Robert Gross

Twickenham, UK

The letter appears here


If you’re in the mood for some light relief, BuzzFeed has compiled a list of Brexit tweets that’ll make you laugh – such as this one.

https://twitter.com/FutbolIntellect/status/747532533642854400


The other papers’ front pages, via the BBC’s Neil Henderson.

The Times reports that Boris Johnson offered to pull out of the Conservative leadership contest in return for an assurance from Theresa May that she would stand down before a 2020 general election.

https://twitter.com/hendopolis/status/748627596854837248

The Guardian also focuses on the Tory leadership with the headline: “The betrayal”.

https://twitter.com/hendopolis/status/748626974315253760

The Sun does the same, but says Boris Johnson was “Brexecuted” in a “Tory bloodbath”.

https://twitter.com/hendopolis/status/748625021975814144

And The Daily Telegraph calls Michael Gove’s surprise entry into the race “An act of midnight treachery”.

https://twitter.com/hendopolis/status/748624220544958464

In Scotland, the pro-independence newspaper The National shows Gove snipping Boris’s famed zipwire line.

https://twitter.com/hendopolis/status/748620179605716992

The Daily Mail has already made an endorsement in the Conservative leadership contest, declaring that with the Tory party “in flames”, Theresa May “must” be the next Prime Minister.

https://twitter.com/hendopolis/status/748631659948421120

While the Daily Express gives Gove the front page with the headline “Gove: I’ll lead us out of the EU”.

https://twitter.com/hendopolis/status/748619333182578688


EmoticonFTSE 100 opens up +0.4 per cent, FTSE 250 gains +0.5 per cent after Carney comments push sterling lower.


New polling figures out from YouGov show Jeremy Corbyn’s support is slipping among party members.

In a poll carried out for the Times , YouGov found Corbyn’s net approval rating – the difference between people who approve and disapprove of the party leader – is just +3, compared to +45 last month.

The Labour party has reportedly signed up tens of thousands of new members since the referendum, as dozens of members of Corbyn’s shadow government have resigned and MPs overwhelmingly backed a motion of no confidence against their leader.

Corbyn has said he will not step down, but shadow business secretary Angela Eagle is expected to launch a formal bid to challenge his leadership as soon as today.


Merryn Somerset Webb, the FT columnist who came out in favour of leaving the EU, offers her thoughts on the state of the nation, and finds “positives amidst the Brexit negativism”.

Here’s a taste:

Models can’t factor in the benefits we will get from new trade deals outside the EU: the US, India, Australia, New Zealand, South Korea and Mexico have already expressed interest in getting deals done fast. They can’t factor in any changes to our welfare system that might result from negotiations over free movement of labour.

They can’t even start to take into account the twists and turns of British politics: how well Brexit goes depends to a large degree on who leads Brexit Britain. Brexit hysterics have spent the last five days behaving as if they know — for absolute certain — what hideous dark disasters are waiting for us around dark corners. They don’t. In a few years they might find themselves pleasantly surprised.

Read the full column here.


Chancellor George Osborne is tweeting this morning ahead of a trip to Manchester, where he is expected to meet with business leaders there.

https://twitter.com/George_Osborne/status/748773418258960384

Osborne’s assertion that there are “clear signs of economic shock” comes after Bank of England governor Mark Carney said there would be “post-traumatic stress” for the UK economy after last week’s Brexit vote.


Many who watched Theresa May’s speech yesterday saw her remarks as confirmation that “out is out”, and that the chances of backsliding on leaving the EU was increasingly out of the question. David Allen Green – legal blogger and a believer in the idea that the UK won’t actually leave – disagrees. He picks up on Ms May’s point that Article 50 – the clause that triggers the exit – won’t be invoked until the end of the year.

https://twitter.com/DavidAllenGreen/status/748481970125049856

https://twitter.com/DavidAllenGreen/status/748484125858865152


The FTSE 250 has given up most of its early gains already this morning. But UK government debt is going strong. This from the FT’s global markets overview:

Benchmark government bond prices, which move inversely to their yield, have been surging as central banks are seen keeping interest rates lower for longer.

The 10-year gilt yield is down 3 basis points to a record low of 0.84 per cent on expectations the BoE may cut borrowing costs next month.



Tony Blair may not be the UK’s favourite former prime minister, but the onetime Labour leader was a proven election winner.

This morning he has issued this warning on the crisis in British politics:

Our nation is in peril. To allow us to come safely through this we need to be adult in our politics, to proceed with calm, maturity and without bitterness, because our future as a nation in the world and as the UK itself is at stake.

With the Labour party effectively disabled,, we need to Conservative party to conduct its leadership battle with genuine patriotic regard for our nation’s interest.

The Daily Telegraph has even suggested Mr Blair is angling for the job of negotiating the UK’s new relationship.

Read the story here.

And don’t forget that next week Sir John Chilcot publishes his long awaited inquiry into the Iraq War, which is expected to be critical of Mr Blair’s role.


The City – London’s financial district – is facing a big challenge from rivals around Europe in the wake of the Brexit vote. Here is a look at what the other rivals are offering and how they plan to take business away from London.

Some key lines:

In a rainy June morning in Paris, five dozen men and women gathered in a basement in La Défense, the city’s financial district. Over bitter coffee and fluffy croissants, the great and the good of French politics, business and finance had gathered to plot a heist.

With two weeks to go before the Brexit vote, they wanted to be ready with a sales pitch to lure the international financial groups based in London, should Britain vote to leave the EU. Now, they reasoned, any company with pan-European aspirations would be compelled to move jobs, business lines, even headquarters out of London.

…and…

The French charm offensive has been notably aggressive, but they are not alone. Frankfurt and Dublin — and a long list of others from Luxembourg to Warsaw — are now clamouring to appeal to the banks, insurance companies and asset managers for whom using the City of London as a single European hub may no longer be sensible. And where those financial services groups go, a whole host of ancillary roles — in law, accountancy, consultancy and the rest — will follow. Tens of thousands of jobs, out of nearly half a million in the City, could be at risk, financiers estimate.

More here.


A fun little story here from The Times:

French bank bosses were snubbed this week when they were not directly invited to a meeting of financiers to discuss Brexit because of concerns that they are working with their government to ensure that well-paid City jobs move to Paris.


Brexit will be a big theme today at the FT’s Festival of Finance – the shindig formerly known as Camp Alphaville – in the City.

Kicking it off at 11am will be Peter Praet, member of the executive board at the European Central Bank. From 11.30am, the FT’s Katie Martin will be holding a panel session with:

- Steve Keen, Head of the School of Economics, Kingston University

- Toby Nangle, Head of Asset Allocation, Columbia Threadneedle

- Richard Woolnough, Fund Manager of the M&G Optimal Income Fund, M&G

- Mike Amey, Managing Director and Portfolio Manager, London Office, Pimco

Look for updates here later and on / FT Alphaville


The day after the Bank of England governor said that further easing would likely be needed over this summer in response to the UK’s vote to leave the EU, gilts have hit a new record.

Yields on the country’s 10-year debt plunged by 0.043 percentage points to 0.819 per cent on Friday morning – a sign that investors are scrambling for safe retreats and believe there could be a recession ahead. (Lower yields reflect higher prices.)

Read more on fastFT here.


Another sign of a potential chill in investment into the UK following the Brexit vote. The BBC reports concern over the vote from industrial giant Siemens:

One of the UK’s biggest industrial companies, Siemens UK, has warned that investment could be hit in the wake of the Brexit vote.

Chief executive Juergen Maier said that while the German giant is committed to the UK, he is worried about the prospects for future investment.

“We are concerned about what the future might hold in terms of new investments that we might want to make” he said.

Siemens has 13 plants in the UK and employs about 14,000 people.

It manufactures and exports high value goods including MRI scanners and gas turbines.

His comments follow news that plans by Siemens to export wind turbine blades from a new facility in Hull have been put on hold.

The company’s links with the UK go back 170 years. And Mr Maier, who campaigned for a Remain vote, insists that Britain is still a good place to do business.

Mr Maier added:

“Short term, in terms of any investment decisions you want to make here, especially those that result in exporting to the European Union, they will be on ice. No question about that.”

More here.


Ken Clarke, the former Chancellor and backbench Conservative MP, has said Michael Gove would “do us all a favour” if he stood down now from the contest to become Tory Party leader.

Mr Clarke said the Conservatives need to turn away from “personality battles” after an extraordinary day in politics yesterday when Mr Gove, the current Justice Secretary, stood for the leadership of the party, having previously been expected to run on a ticket with Boris Johnson.

Speaking to BBC Radio, Mr Clarke said it in the “national interest” that a new prime minister is selected as “quickly and sensibly as we can” so that the winning candidate can assure businesses and investors, who are nervous about the outcome of the vote.

Read more on fastFT here.

Gove is due to set out his stall in the Conservative leadership contest in a speech at 11am today.


Waiting for BoJo – the FT’s Robert Shrimsley channels Samuel Beckett in his take on Brexit where David Cameron tells the EU that he’s off:

You can’t eat unless you stay.

I can’t go till I eat.

You can have something to eat once you leave.

Do you promise?

Maybe.

So what now?

You should leave.

Right. I’m off. (He does not move)



The New York Times has this rather unforgiving piece on Boris Johnson, the man who would be king (but now, it appears, won’t).

He was lying. The reports were correct, and he was fired from his parliamentary job as the Conservative Party arts spokesman. But it didn’t seem to bother him too much. Mr. Johnson has always had a knack for recasting disaster as farce, and he devoted his weekly newspaper column to the virtues of being fired.


How did Michael Gove force Boris Johnson to surrender? The FT’s George Parker has the full story:

“Michael tried to make Boris’s campaign work but it was becoming clear it wasn’t going to work,” the ally said. “He wasn’t giving people the love or attention or making the offers to people that were required.”


More from that BBC Radio 4 interview with Ken Clarke:

On Gove:

“It’s only over night, as it were, but I do think that Michael Gove would do us all a favour if he were to stand down now and speed up the process, because I do think that one of the first priorities of a leader of a party and certainly of a prime minister is you should have the trust of your colleagues.”

On Boris:

“I was one of those who was appalled by the idea of Boris Johnson being prime minister but I’m not falling out with him personally.”

On Liam Fox:

“Profoundly wrong” is Clarke’s view of the former defence secretary’s analysis of the UK’s trade options.”He appears to imagine that the US has the same access to European markets as Britain does at the moment. It doesn’t.

On Theresa May:

“She is certainly papabile – such a silly phrase for me to use ” he says explaining it was originally the Vatican term to describe a Cardinal capable of being a Pope. “She certainly has got all the ability of course. She is in the right class of contender.”

Clarke jokes he has put himself through a number of leadership contests in his career – “one of the bad habits I have given up”. But he adds:

“We’ve never had ( a leadership contest) like this and never had one so important. I’d be pleasantly surprised if we don’t have a recession in the next twelve months. But it’s going to need to a very good prime minister who knows what he or she wants to do to avoid that.”


Markets update: the FTSE 100 is up a touch at +0.3 per cent, but the FTSE 250 has reversed from earlier, now down -1 per cent.


Leave.EU, the group that campaigned for Brexit with the backing of Ukip donor Arron Banks, is supporting Andrea Leadsom’s bid for Conservative party leader, encouraging followers on its Twitter page to update their profiles with #Leadsom4Leader.

https://twitter.com/LeaveEUOfficial/status/748805477601988608

Leadsom was part of the rival Vote Leave campaign, the official “Leave” campaign in the run-up to the referendum.


While Michael Gove’s launch speech is likely to inject a dose of energy and excitement into the political story this morning – the mood is undoubtedly more sombre.

Many across the country pause today to mark the anniversary of the first day of the Battle of the Somme – the deadliest battle in British history.


Reuters have an interesting analysis of the perils of holding a referendum that changes the rules on freedom of movement – in Switzerland, not Britain.

Here is a taste:

A shock referendum result demanding controls on European Union migration has created a serious headache for politicians, who must do the people’s bidding without jeopardising access to the single market. Not Britain: Switzerland.

Home to more than a million EU citizens, Switzerland voted on Feb 9, 2014 to impose quotas on migration, potentially ripping up a bilateral deal with the EU on free movement of people. It could trigger a “guillotine clause” cancelling six other bilateral agreements, including on air transport, road, rail and agriculture.

The government sees few ways out and, in what could be a warning to Britain, may have no choice but to ask voters to reconsider. Though even that is difficult.

You can read the full report here.



Jean-Claude Juncker, president of the European Commission, has reiterated that there will be “no negotiation whatsoever” before notification of the UK’s intention to leave the EU is sent. He added: “We cannot add uncertainty to uncertainty.”

He also warned there is “no time to lose”, urging the UK to begin formal talks with the bloc about its tricky divorce process. Speaking in Bratislava at the launch of Slovakia’s six-month presidency of the EU, Mr Juncker “re-invited” the UK to “make its intentions clear”.


Sky News reports that low-cost airline easyJet is in talks over moving its base following the Brexit vote.

https://twitter.com/SkyNewsBreak/status/748814691737083904

UPDATE: Sky now has a full story here.


Britain’s shock decision to leave the EU has left the country’s fund management industry reeling from intense market turmoil, investor outflows and sharp share price falls for listed asset managers, the FT’s Madison Marriage reports.

As fund managers attempt to wade through the fallout from the referendum, most are reluctant to comment on how the new political reality is affecting their investment decisions, their client base or their businesses.

“No one has any sight on how this might unravel at present, so best not to speculate,” says one of Britain’s best-known fund managers.

But the few who will comment point to another, more disturbing, risk for markets that they believe has grown as a result of the vote for a British exit, or Brexit, from the EU: a break-up of the eurozone.

Read Marriage’s first article here.


First May, now Gove.

Justice secretary Michael Gove joined Twitter this morning, one day after he revealed that he would be throwing his hat into the ring to become the next Conservative party leader.

https://twitter.com/Gove2016/status/748805897107886080

His first – and so far, only – tweet has gained him more than 1,100 followers, as well as a barrage of angry replies.

Gove is expected to set out his stall for leadership in a speech in central London, scheduled to start at 11am.


A bit more from Jean-Claude Juncker, via Duncan Robinson in Brussels:

The European Commission president added that countries have to accept free movement if they want access to the single market – an argument underscored by German chancellor Angela Merkel this week.

Mr Juncker said: “There was one major issue and that was the movement of workers and I will not change that.”

Some Brexit campaigners have suggested that Britain would be able to negotiate access to the single market while introducing stricter controls on migration.

Mr Juncker insisted that the free movement of people, goods, capital and services were mandatory for being part of the single market. “If you want to have access like other member states you have to accept all the consequences of the four freedoms,” said Mr Juncker.


More colour from The Daily Telegraph on how Michael Gove scuppered Boris Johnson’s bid to be PM, including more detail on that 8.30am phone call reported by the FT’s George Parker and others.

Mr Lynton Crosby, Boris Johnson’s campaign manager, was making final preparations for the formal announcement of Mr Johnson’s Tory leadership bid when his phone rang at 8.53 on Thursday morning.

“Hi Lynton, it’s Michael Gove here,” said the voice on the other end. “I’m running.”

“Running what?” Sir Lynton replied.

“I’m running for the leadership myself.”

Sir Lynton was stunned. With two hours to go until the launch of Mr Johnson’s leadership bid, Mr Gove, the man who was supposed to be making up the “dream ticket” with him, had not so much stabbed him in the back as run him through with a pikestaff.

More here.


Michael Gove is now making his first speech since announcing yesterday that he would be entering the race to replace Prime Minister David Cameron as leader of the Conservative party.

Gove is speaking at Policy Exchange, a right-leaning think-tank with close ties to Cameron.


Was it a betrayal? Boris has just been doorstepped by the BBC.

Do you think you were betrayed by Michael Gove, he is asked.

“Yup,” Mr Johnson mumbles, which sounds like a confirmation.

But he said: “It’s up to somebody else now and I wish him every possible success.”

Asked if he regrets campaigning for Leave, he says:

No I think It will be great for our country. I think we should be positive. I think everybody must take advantage of what I think will be a glorious opportunity for Britain.”


Gove, who has repeatedly said in the past that he did not want to be Prime Minister, just said he was “so very reluctant” to throw his hat into the ring “because I know my limitations”.

“Whatever charisma is, I don’t have it, Gove added.

But Gove said he decided to stand after asking himself: “What is the right thing to do?”


Gove has said he is standing “as the candidate for change”, saying, “We cannot meet this historic moment with timidity and caution.”

The justice secretary, who was until 2014 education secretary, also spoke of his own early childhood – he was adopted at four months old after being in the care system – and said he is standing “with a belief in human potential”.


A blunt warning this morning from an executive board member of the European Central Bank Peter Praet on the impact of the Brexit vote on the economy.

In a written speech for the FT Festival of Finance in London, Mr Praet said:

“Recent data do not yet reflect the renewed uncertainty originating from the UK referendum. Such uncertainty may weigh on economic confidence and partly reverse the recent improvements in investment and consumption, also in the euro area.

“Accordingly, it is essential to swiftly establish an orderly process that governs the path towards a new post-referendum steady state so as to allow households and firms to swiftly adjust their inter-temporal economic decisions to the new environment.”

“Such uncertainty may weigh on economic confidence and partly reverse the recent improvements in investment and consumption, also in the euro area. Accordingly, it is essential to swiftly establish an orderly process that governs the path towards a new post-referendum steady state so as to allow households and firms to swiftly adjust their inter-temporal economic decisions to the new environment.”

However, the FT’s Gavin Jackson also reports that Mr Praet added:

“It is very important to see that the episode with British exit there was not really a liquidity shock in the banking sector,” he said. There is “surprising resilience of the financial sector in general”.

Full speech here.



Gove, a key “Leave” campaigner, is pledging to bring the UK out of the EU as Prime Minister, saying: “The best person to lead Britain out of the European Union is someone who argued to get Britain out of the European Union.”

The odds-on favourite in the Conservative leadership contest, Theresa May, campaigned for the UK to remain in the EU but said in a speech yesterday that “Brexit means Brexit” if she were to become the next Prime Minister.


At one point during his lengthy speech – Gove is still talking after around 30 minutes – the justice secretary took aim at bankers and big businesses, saying “too many people in financial services “are paid vast fortunes as if they are outstandingly skillful when in many cases they are simply lucky”. He also bemoaned that rewards in Britain have gone too often to “big businesses who have rigged the market in their interests”.

Read more on fastFT here.


Michael Gove’s speech is not going doing well at the bookies. His odds for winning the leadership have widened significantly. He was 5/1 this morning.


For a more detailed look the comments of Peter Praet of the ECB on Brexit and the discussion of the issue from a whole lot of experts, swing by FT Alphaville’s live blog here


A neat observation from BuzzFeed’s head of UK news:

https://twitter.com/stuartmillar159/status/748829189978009600


Key points from Michael Gove:

-Invest more in the NHS – “at least £100m” a week by 2020
-Invest more in science and R&D
-Reboot the union with Scotland, Wales and Northern Ireland
-Repatriate money sent to Brussels to invest at home, principally in the NHS
-Cut VAT on domestic fuel

On Europe:
-Deliver on the Leave result
-End free movement of labour
-Introduce Australian-style points system to manage migration
-Bring migration numbers down
-Made no mention of the single market
-No detail on an alternative trade model


After Brexit, Auxit? Austria’s constitutional court has ordered a re-run of May’s presidential election in which the rightwing nationalist candidate was beaten narrowly, reports the FT Ralph Atkins.

Judges ruled that irregularities highlighted by the losing Freedom party were sufficiently serious to invalidate the result. The contest will provide an early test of support for Europe’s nationalist parties following the UK’s vote to leave the EU last week.

Norbert Hofer, the populist Freedom party candidate, lost the May 22 election by 31,026 votes after a surge in support fuelled by Europe’s migration crisis and voter dissatisfaction with the country’s mainstream political parties.

Mr Hofer has previously indictated his support for a referendum in Austria on its membership of the EU.

More here.


Boris Johnson this morning, presented without comment.


Emoticon George Osborne has backtracked on his long-held goal of restoring the public finances to surplus by the end of the decade.

In a speech in Manchester, the chancellor said that the government needs to be “realistic” giving the economic shock generated by the decision to leave the European Union, reports the FT’s Emily Cadman.

“The government must provide fiscal credibility so we will continue to be tough on the deficit but we must be realistic about achieving a surplus by the end of this decade,” he said.


Ed Miliband, former leader of the Labour party, was clearly listening in to Mr Gove’s speech, and saw an opportunity to take a dig at him.

https://twitter.com/Ed_Miliband/status/748830436906926080


Will there be another general election before the end of the year?

Just over half of voters think there should be, according to a new poll out today from BMG Research.

BMG carried out the poll for the Evening Standard , finding that 52 per cent of UK adults think there should be a general election this year, while 32 per cent say there should be no election. Sixteen per cent of people don’t know.

Both Theresa May and Michael Gove have said they would not call a general election if they are elected as Conservative party leader.


Michael Gove joined Twitter this morning, and has been using this new platform to make his case:

“The country voted for no more politics as usual. No more business as usual. I am the candidate for change. #Gove2016″


If you’re in the market for a water cannon, Sadiq Khan has a few going spare. He’s decided to sell the three Boris Johnson bought during his time as London mayor.

Reminder: Theresa May used the cannon purchase to have a dig at Mr Johnson yesterday morning, when it still seemed likely that he would challenge her for the Tory party leadership.


If you’re in the mood for a laugh, then you should have a look at this “leaked Vote Leave plan” for what happens now.


More evidence of Brexit regret – a poll by Opinium of 2001 UK adults found that 7 per cent of those who voted Leave feel like they did not make the right choice, compared with just 3 per cent among those who voted Remain.

Other findings

- The majority of Brits (60%) think we should have a general election before official negotiations begin, with just over half (55%) of all UK adults believing that the next Prime Minister needs to be pro-Brexit to get the best exit deal from the EU.

However, with a Conservative government in power, there needs to be a trusted leader in place, and for a quarter (24%) of the nation, Theresa May is the favourite to take Cameron’s place in number 10 come 9th September.

However, two in five (41%) think a Tory leadership election will cause uncertainty.

Amongst Labour voters, although the favourite single choice of leader is Corbyn, he was the preferred choice for only a quarter (24%) of Labour voters – a poor showing for an incumbent leader. However, a third (32%) of UK adults thinks a Labour leadership election will stop them holding the Government to account.

When it comes to actually leading these negotiations, the Tories are the most trusted (28%) – amongst both Remainers (24%) and Leavers (34%) – followed by Labour (13%) and UKIP (11%).

The poll was carried out between June 28 and June 30.


One for Twitter users – Boris Johnson has been doorstepped by Sky News. Here’s the clip.

https://twitter.com/SkyNews/status/748844843242102784


EasyJet has said it has no plans to move its headquarters outside of the UK, despite reports that the low-cost airline was looking to relocate to an EU member state after last week’s referendum.

The FT’s Michael Pooler reports that EasyJet says it has no plays to move from Luton, where it was founded and continues to have its headquarters, but has begun a formal process to acquire an air operating certificate in a European country.

Read more on fastFT here.


The FT has published another free Brexit tabloid, which is being distributed today in London.


Former environment secretary Owen Paterson has endorsed Andrea Leadsom in a lengthy article for The Daily Telegraph, saying the energy minister “understands out means out” and has “an optimistic vision for our future”.

I believe there is one person who can fulfil this mandate. One woman who understands out means out. One woman who has an optimistic vision for our future. One woman who would be the first prime minister in 26 years with a solid understanding of economics needed to steer our economy competently and confidently. As a businesswoman, a mother and an exemplary local MP, she has acquired a true understanding of the needs and aspirations of the people up and down the land.

I am backing Energy Minister Andrea Leadsom to be our next Prime Minister.

Read the full article here.


Earlier today, George Osborne backtracked on his long-held goal of restoring the public finances to surplus by the end of the decade, saying the government needs to be “realistic”, given the uncertainty generated by the decision to leave the EU.

The FT’s economics editor Chris Giles says there are “three important consequences that flow from the chancellor’s decision: one good and two bad”.

Read Giles’s full assessment here.


More on the economic fallout of the vote to leave from the FT’s property correspondent Judith Evans.

She reports that more than £650m of commercial property deals in the City of London have collapsed since the vote.

This includes the proposed purchase of the landmark Cannon Place, a 389,000 sq ft office scheme in the heart of the city. Read more


Fed vice chair Fischer: ‘Wait and see’ on Brexit

The vice chairman of the Federal Reserve has been speaking to CNBC in the last hour in the first public comments from a high ranking Fed official in the wake of the UK’s vote to leave the EU.

Stan Fischer told the US network that policymakers “were extremely surprised” by the referendum outcome but were still assessing its impact on the US economy and the future path for interest rates.

We’re going to have to wait and see. Brexit is huge for the UK and important for Europe.

Mr Fischer added the impact of the vote would likely unwind “over a long period of time” but that in the immediate term, jobs data from the US showed the domestic economy was doing well.

His comments come as markets no longer expect any monetary tightening from the Fed until late in 2017.

Mr Fischer’s more reflective thoughts come after James Bullard, often seen as one of the FOMC’s more hawkish members, said yesterday Brexit’s impact on the US was:

statistically in the neighbourhood of zero”



(c)Bloomberg

A week on from the vote to leave the EU, the priority now for firms is adjusting to the new reality.

Patrick McGee has been talking to the chief executive of Siemens UK, who warned that an irony of the Brexit vote is that UK industry will be mired in far more bureaucracy than when rules were made in Brussels.

Much of the Leave camp’s campaign for exiting the EU was to cast off the yoke of centralised decision-making from un-elected leaders in Belgium.

But Juergen Maier said “it’s a total irony” that Siemens operations are, in fact, “incredibly less bureaucratic” if the UK is a part of the EU.

The threat of tariffs could make exports more expensive, but Mr Maier said the bigger threat is so-called non-tariff barriers — product standards, rules, regulations and other practices — which will add complexity.

“It’s been much simpler for our companies to operate [with one set of rules]”, he said.

Mr Maier told the FT earlier this week that Siemens’ plans to export wind turbine blades from Hull, where its manufacturing plant is expected to be up and running this year, were on hold and could be disrupted by Brexit.

On Friday, he added that “Hull was always intended to be focused on the UK market in the short term.”

The plan for the £160m plant to open this year and employ 1,000 people is still in place.

“But ultimately the real prize, not just for ourselves but for the broader Humber area, is to export technology around the world.”

Britain is already home to the largest offshore wind market in the world. Mr Maier said a lot of work has gone into research for developing future technology, in part thanks for funding from the EU. Investments into the research are now on pause.

If it is unclear what the UK’s relationship is with the EU, or if the UK is unable to maintain good trading terms, then the German industrial conglomerate may be forced to shift its long-term plan to instead export wind turbines from Germany, Spain, or Denmark, Mr Maier said.

“Of course, I’m hopeful we will find way through,” he added.

Asked if Brexit could turn out to be helpful to Hull’s export plans because of a weaker sterling, Mr Maier said the exchange rate could in the short-term boost the economy, but he must plan for the long-term.


Brexit causing ECB a €1trn bond headache

More from central bank world and one of the unforseen consequences of the Brexit-induced flight to safety is the ever expanding world of negative yielding government bonds.

As it stands, more than half of all outstanding eurozone government debt worth €3.14trn is trading at sub zero levels. Of that, just under a trillion, €984bn, has fallen below the minus 0.4 per cent limit which excludes it from the European Central Bank’s bond buying.

With speculation that the ECB’s stimulus measures could be hitting a supply buffer, there’s talk it will need to start changing its rules to make sure it meets its €80bn a month purchase target.

For more, see your post at FastFT.


Scotland reassures EU university students

The Scottish government has told EU students who receive free higher education that they will continue to be funded for the duration of their studies in the aftermath of the Brexit vote.

In a statement today, the government said:

Following the outcome of the EU referendum, Scottish Government and Universities Scotland have reassured EU students in Scotland that they will continue to benefit from free tuition and associated support for the duration of their course.

The government also escalated its calls for a “post study work visa” allowing international students to remain in the country for a defined period having finished their studies.

John Swinney, deputy first minister and education secretary added:

“Today’s statement sends a clear message that EU students are welcome in Scotland and their contribution is valued.

We are proud that Scotland is a destination of choice for students and staff from overseas and I am firmly committed to ensuring this remains the case.




FTSE on course for best week since Dec ’11

It’s almost time for markets to pause and take breath in the first post-Brexit week of trading.

As we approach the closing bell in London, the FTSE 100 is 1 per cent up on the day and set to close 7.2 per cent higher on the week – its best weekly performance since December 2011.

Trading around 6567 today, the FTSE is now well above the 6338 pre-Brexit close hit on June 23.

But the junior FTSE 250, arguably a far better gauge for Brexit stress as it is mainly dominated by companies with domestic earnings, is on course to close the week just 2.3 per cent higher, still its best five days of trading since market turmoil hit in February this year.

At publication time, the FTSE 250 is trading 1.16 per cent higher at 16, 467, just over 850 points lower than its 17,333 pre referendum close.

The rally has gained momentum since yesterday after Bank of England governor Mark Carney all but promised more monetary easing for the UK economy later this year.

But analysts are divided over whether the sugar rush of verbal easing can last for UK stocks.

“Whether the market can sustain this ebullient rally into next week is a different matter entirely” says Chris Beauchamp at IG.

“Those hoping for a respite from Brexit next week are likely to be disappointed.”


Le Monde speaks

You know things are bad when French newspapers start reverting to English.

Le Monde, France’s centre-left newspaper, has published an unequivocal take on the former London mayor in its latest editorial titled “Shame on you, Boris!”.

The paper accuses Mr Johnson of not understanding the “enormity” of the forces he helped unleash as the most prominent figure in the Leave campaign.

“Mr. Johnson is 52, not 13″, lambasts Le Monde.

It’s not the first time the French have poked fun at Mr Johnson; here’s Liberation’s front-page the day after Independence Day.

https://twitter.com/An_Phoblacht/status/748481855884767232


Farage set for Carswell fight

Just in case you thought Britain’s political bloodletting was over for a while, enter UKIP

Leader Nigel Farage has suggested today he will try and dethrone the eurosceptic party’s only MP, former Tory Douglas Carswell, when its national committee meets next week.

https://twitter.com/SebastianEPayne/status/748903761939234816

Speaking on London radio today, Mr Farage said:

We find someone in our party who doesn’t agree with anything the party stands for. It’s a very odd state of affairs. I don’t get involved with [expulsions]… That will be up to the party’s NEC to decide on Monday

Why would you join a party like UKIP with me as the leader, and with our policies and manifesto, and from almost day one of joining disagree with everything we do. I find it really, really odd.”


Investors push bond yields to record lows amid Brexit growth fears


German foreign minister lashes out at Cameron

Talk about kicking a man when he is down.

Stefan Wagstyl in Berlin reports on an extraordinary outburst from German foreign minister Frank Walter Steinmeier, who has let rip at prime minister David Cameron, chief Leave campaigner Boris Johnson, and the Tory party.

Whereas chancellor Angela Merkel has refrained from allocating blame over the Brexit debacle, Mr Steinmeier showed no such restraint:

“What angers me most is that both of the main opponents [meaning Mr Cameron and Mr Johnson] in the Tories have turned what was initially only an inner-party conflict into a full-blown state and government crisis in Great Britain and so also have caused damage to the whole EU.

And now they have left responsibility for the consequences to others.”

A social democrat, he castigated the centre-right Conservatives in language rarely heard within the EU, where countries normally refrain from criticising each other in public even in terms far softer than Mr Steinmeier’s.

He told Der Spiegel magazine:

You almost have the impression that some prominent Brexit supporters really did not want an exit, but hoped for a narrow defeat.

In any case, you cannot discern that anybody on the British Isles had a plan. Many people are clearly confused and shocked that the British vote really has consequences and not only in the electorate but also in politics. Within the Conservative party disorientation prevails, and with Labour it doesn’t look much better.”

Mr Steinmeier urged Britain to secure, as soon as possible, a “politically legitimate functioning government”.

What we can expect from London is and, indeed, quickly is a road map when the exit negotiations with the EU should start and how the British imagine these negotiations.

He warned that further delays were not desirable and were “certainly damaging for the British themselves and also for us in Europe….The longer the period of uncertainty lasts the bigger the risk that the negative economic consequences will not be limited to the UK.”

Mr Steinmeier said that his ministry was already preparing a Brexit Taskforce.


Markets close higher in rocky post-Brexit week

The closing bell has rung across the continent, and all of Europe’s major indices are ending their first week of post-Brexit trading firmly in the green.

Britain’s benchmark FTSE 100 has finished the week 7.2 per cent higher – its best weekly performance since the end of 2011.

Here’s where we stand:

FTSE 100: 1.43 per cent up; 7.2 per up on the week
FTSE 250: 1.2 per cent up; 2.4 per cent up on the week
Dax: 1 per cent up; 2.3 per cent up on the week
CAC 40: 0.86 per cent up; 4.5 per cent up on the week
FTSE Eurofirst 300: 0.74 per cent up; 3.4 per cent up on the week

And with that, we’re signing off on today’s live Brexit coverage. Hope you can join us again soon.