Bettors are convinced Theresa May won't win approval for her Brexit deal in the Commons and are getting cold feet about the UK leaving the EU on 29 March, says Max Liu.
"On the Exchange, the uncertainty has seen the odds on Britain leaving the European Union on 29 March drift to [1.93], with the price on that not happening narrowing to [2.02]."
Theresa May is 5/2 to lose her job as Conservative Party leader this year after shadow Brexit secretary Kier Starmer said Labour will push for a vote of no confidence in the government if the Prime Minister's Brexit deal is defeated in the House of Commons on December 11.
Starmer said on Sunday: "If the prime minister has lost a vote of that sort of significance, then there has to be a question of confidence in her government. I think it's inevitable that we will seek to move that."
The PM is trying to win support for her version of Brexit, which EU leaders reiterated this weekend is the only deal on the table, but as many as 100 Tory MPs are believed to be prepared to vote against their leader's deal in nine days' time.
Today, the Exchange makes miserable reading for May with her Brexit bill backed in to [1.16] not to pass, so it looks like being a question of by how much the PM loses the vote. If, on the other hand, you think the PM and her Whips can talk MPs around, then you can get [7.0] on the bill passing.
Exchange odds drift on UK meeting Article 50 deadline
Losing the vote on 11 December would be an enormous blow to May and could open the Brexit floodgates to pretty much any possibility.
On the Exchange, the uncertainty has seen the odds on Britain leaving the European Union on 29 March drift to [1.93], with the price on that not happening narrowing to [2.02], as bettors start to put money on the UK staying in beyond the deadline set when Article 50 was triggered last year.
If Parliament rejects May's deal, the government might attempt to extend the Article 50 period, rather than risking leaving the EU with no deal. But there's uncertainty about whether it's possible to extend Article 50, although it's believed that the EU would agree to an extension if the government agrees to holding a second referendum or a general election in which one of the main parties advocates no Brexit.
Starmer reiterates Labour's desire for an early election
Earlier this week, shadow chancellor John McDonnell was quoted as saying it's "inevitable" that Labour would eventually back a second Brexit referendum - something which is [2.4] to happen before the end of next year.
Everybody knows, however, that what Labour really want is a general election, earlier than the 2022 date that's schedule in by the terms of the Fixed Term Parliament Act. Were it not for the FTPA then, in the light of May losing the vote on 11 December, a general election would be a real possibility.
However, it's precisely for that reason, and the Tories' reluctance to risk Jeremy Corbyn getting the keys to Ten Downing Street, that a general election before Brexit is [2.52.] Paul Krishnamurty explains why he believes that's unlikely in his analysis of how Brexit will affect the two main parties.
Labour rule out pact with the SNP
SNP leader Nicola Sturgeon has long argued that Scotland is being ignored by the Prime Minister in the Brexit preparations and dragged out of the EU against its will. Sturgeon has a point, as Scotland voted 62% to Remain in 2016.
There has been speculation that the SNP would do a deal with Labour, where Jeremy Corbyn promises to give Scotland an independence referendum in exchange for the SNP's support in the event of a hung parliament - which is [2.34] on the Exchange - at the next general election.
This weekend, John McDonnell ruled out such a pact, saying: "We wouldn't have a deal with other political parties," he said. "We believe we will win the next election with a handsome majority."
The odds suggest McDonnell's confidence is misplaced, but you can see why he's ruling out a pact with Sturgeon. Remember how David Cameron weaponised the possibility of a Lab/SNP coalition against Ed Miliband in the run up to that year's general election? McDonnell is wise to scotch the idea, at least until after the election.
Where that leaves Scotland remains to be seen. The latest polling on independence shows support at marginally lower than the 45% that voted for it in the 2014 referendum. On Sportsbook, you can get 8/11 on Scotland voting to stay in the Union in the event of another referendum.