British Pound volatility surged amid a series of Brexit votes on Tuesday. In the first of two votes, Prime Minister Boris Johnson received preliminary approval for his Brexit deal from members of parliament – passing 329 to 299. The motion’s success saw GBP/USD ticker modestly higher, but price action was tempered as market participants awaited the second and more-important vote, a fast-tracked Brexit timetable.

The second vote, referred to as the program motion, saw the Pound swing wildly as anticipation ahead of the results boiled over. The program motion vote did not pass, however, with 308 ayes to 322 noes. Consequently, GBPUSD plummeted before reclaiming some ground to trade around 1.2924.

GBPUSD PRICE CHART: 1 – MINUTE TIME FRAME (OCTOBER 22) (CHART 1)

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Meanwhile, EURGBP surged to nearly 0.8640 before falling to rest around the 0.8619 mark. Evidently, the failed vote and the Pound’s reaction suggests market participants perceive heightened odds of a no-deal Brexit.

EURGBP PRICE CHART: 1 – MINUTE TIME FRAME (OCTOBER 22) (CHART 2)

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In response to the failed vote, Prime Minister Boris Johnson said the next steps are “to intensify preparations for a no-deal Brexit” and “pause legislation until the EU has made up its mind about a delay.” Given the dwindling timeframe ahead of the October 31 deadline, the Prime Minister’s suggestion of a pause in legislation does raise some questions. It could be argued such a pause would result in the UK being left without an alternative when the deadline arrives, essentially forcing a no-deal Brexit to occur.

Across the English Channel, the European Commission said President Donald Tusk is consulting EU leaders on extending the Brexit deadline to January 31, 2020 after the UK government lost the fast-track vote in Tuesday’s parliamentary session. Now, discussions between EU and UK officials will have to take place in addition to President Tusk’s EU-wide consultation. While the Brexit outcome seems entirely uncertain at this time, one theme is likely to persist - sustained volatility for the British Pound and its various crosses.