Britain still odds on for Brexit extension, not deal, say bookmakers

Oscar Williams-Grut
Senior City Correspondent, Yahoo Finance UK
British prime minister Boris Johnson, left, is watched by president of the European Commission Jean-Claude Juncker, centre, and EU chief Brexit negotiator Michel Barnier, as they address a press conference in Brussels on Thursday. Photo: Kenzo Tribouillard/AFP via Getty Images

Punters and bookmakers think Britain is still more likely to get a Brexit extension than leave the EU with a deal on 31 October, according to British bookmakers.

Ladbrokes (GVC.L), Paddy Power (FLTR.L), Betfair, and Smarkets were all offering longer odds on a delay than an exit on 31 October. It comes despite the fact that Britain and the EU reached a new deal on Thursday.

MPs are set to hold an extraordinary sitting of parliament this Saturday to vote on the deal. However, there is widespread doubts about whether it will pass in the House of Commons.

“We think the vote on Saturday is going to be very tight,” a spokesperson for Paddy Power said. “At the moment we have it priced 4/5 that the Withdrawal Agreement will not pass the House of Commons. Evens that it will.”

Leaders of the Labour party, the Liberal Democrats, the Democratic Unionist party, and the Brexit party have all spoken out against the deal. The Benn Act, past last month, forces the prime minister to write to the EU requesting a Brexit extension if a deal is not finalised by this Saturday.

READ MORE: Pound volatile as UK and EU reach new Brexit deal

Paddy Power’s odds of Britain leaving the EU by 31 October shortened on Thursday to 7/4 following the new deal. But the bookmaker was still offering much better odds on an extension at 2/7. That translates to a 77% probability of an extension, against a 36% probability of leaving on October 31.

Rival bookie Ladbrokes was offering odds of 5/2 of Britain leaving the UK by 31 October, equating to a 28% chance, but odds of 2/5 of an extension, equalling a 71% chance. Betting exchange Betfair offered similar odds.

“Although the new Brexit deal has been given the green light, the prime minister still needs backing from MPs and that's reflected in the odds favouring Article 50 being extended and the UK remaining in the EU beyond October 31st,” Jessica O'Reilly of Ladbrokes said.

On betting exchange Smarkets, the probability of the UK leaving by the end of the month was 31% by Thursday afternoon, up from 18% this morning. But the likelihood of an extension was priced at 69%.

READ MORE: 'We've been here before': UK firms give Brexit deal cautious welcome

The bets on a Brexit delay come despite comments from European Commission President Jean-Claude Juncker suggesting the EU would not grant a Brexit extension.

“There will be no prolongation,” Juncker said on Thursday afternoon. “We have concluded a deal and so there is not an argument for further delay – it has to be done now.”

While Juncker’s comments cast doubt on an extension, it is ultimately up to the European Council — made up of the 27 EU leaders — to decide whether to grant one.