Saturday's parliamentary vote on UK PM's Brexit deal is on a knife-edge - ING

James Smith, a developed market economist at ING, reckons that the British government may be just two votes short of winning – although there are of course several moving parts.

• "We know the Democratic Unionist Party (DUP) will not vote for the deal, at least as things stand. And conventional wisdom suggests that without the DUP, many pro-Brexit Conservative MPs (from the European Research Group, or ERG) won't back the deal either.
• But that no longer appears to be the case. Buzzfeed reckons 10 out of 28 ERG MPs would not vote for the deal, although many others are keeping their cards close to their chest – former Conservative leader Ian Duncan-Smith has signalled concerns.
• But there is a chance that when push comes to shove, all of these 28 MPs back Johnson’s revised agreement. After all, there is a lot to like for them in this agreement - the UK (with the exception of Northern Ireland) is no longer tied into the single market and customs union.
• It also looks like the anti-‘no deal’ MPs who were ousted from the Conservative Party a few weeks ago - with the exception of those that didn’t vote for Mrs May’s deal - will also back the agreement.
• That probably means everything will hinge on Labour. Five of their MPs voted for Mrs May’s deal back in March, and it looks like they will be joined by a sixth. But that would still leave the government a few votes short – and more opposition lawmakers will be needed to get the deal over the line.
• That could be challenging. Johnson’s deal is economically-harsher than the previous agreement, mainly by virtue of the fact that the UK (excl NI to an extent) is outside of the EU’s customs union. But the clincher might be the so-called level playing field commitments.
• That’s a worry for Labour MPs, not just in terms of the direct impact of watering down these rules, but it could also make Brussels less inclined to negotiate a wide-ranging EU free trade deal in future.
• In the end though, the revised deal is a fudge. The level playing field commitments have been removed from the legally-binding withdrawal agreement, but there is still an aspiration to keeping them, contained within the non-binding political declaration.
• Many Labour MPs will still be wary – and if nothing else, voting for the deal could theoretically help hand Johnson a better election victory."