Cable (GBPUSD) continues to hold up quite well in the face of the fiasco that has become characteristic of the UK’s handling of Brexit. Yesterday, Prime Minister May went on a begging trip to the EU to seek the fourth extension to the UK’s membership of the trade bloc the people voted to leave almost 3 years ago, a mere 22 days after she addressed the nation to assure them that Brexit would not be delayed beyond June 30. The new end date is 31st October, but as with the four previous dates it would be an optimistic person indeed that diarised it in anything other than pencil. The political problems for the UK only looks likely to get worse as the current ruling party seems to lack the will to remove her, which must surely be the equivalent of setting yourself on fire and hoping it will burn out before too much damage is caused. The UK will hold local elections in around a third of constituencies on May 2nd, and forecasts seem evenly divided between projections for a record low turnout (participation is optional), and those who will use this opportunity to punish the Government by proxy. Although there should be clear water between the antics in Parliament and the good offices of local councillors, the Conservatives are facing a political backlash that is likely to be catastrophic, and a General Election now would see them rendered politically irrelevant. Our previous position was that there is medium/long term value in Sterling if the Government can only stop trying to fudge the issue and deliver an outcome, but for as long as this pattern of trying to please both sides continues they will cause nothing but damage. We’d suggest Sterling bulls practice extreme caution as we approach the local elections, because if voters show a strong swing to the opposition Labour Party the current levels will look significantly overvalued.