europe union building

Pound falls following proposed Brexit bill

1st March 2018 Market Update

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🇬🇧 GBP – Sterling fell over a cent throughout yesterday’s trading session. The reason for this was, the EU published its first Brexit withdrawal plan which said it would keep Northern Ireland in the Customs Union. Theresa May quickly rejected this as an option and stated “No UK prime minister could ever agree to it.”

The major data today is manufacturing PMI. It’s forecast to come in worse than previous at 55.1, which will likely see the pound weaken even further from yesterday.

🇪🇺 EUR – The big data out yesterday was inflation figures from the Eurozone which dipped to the weakest level since 2016. As expected it fell 1.2% which also hindered the single currency.

Core inflation did however remain steady, ahead of next week’s closely-watched European Central Bank meeting.

No major data out today which will affect the market.

🇺🇸 USD – Today we have Fed Chair Powell testifying, he’s expected to continue his mantra that the US economy will remain strong and that market volatility won’t stop further rate hikes.

Also, ISM Manufacturing is out, expected to come in at 58.7 from 59.1 last month. Again, likely to see the pound weaker.

 

Key Announcements

🇬🇧 GBP
09:30am: Manufacturing PMI

🇺🇸 USD
15:00pm: Fed Chair Powell testifies
15:00pm: ISM Manufacturing PMI

 

Summary: The pound fell yesterday following the EU’s proposed Brexit withdrawal bill which suggested that Northern Ireland would remain part of the customs union, which Theresa May quickly refuted. Today the misery looks set to continue with manufacturing expected worse.

 

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Darren Kilner

Darren Kilner

Darren is Head of Dealing at FairFX. Darren lives and breaths FX, his Mastermind topics are G8 currencies and economic forecasts.

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