Bercow Deals Blow to the PM
19th March 2019 Market Update
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?? GBP - Theresa May took a heavy blow yesterday after House of Commons Speaker, John Bercow, warned that the PM cannot bring the same motion to back to the Commons again to vote on. He stated that the deal must be “fundamentally different” and thus something new must be agreed with the EU.
A vote was pencilled in for Tuesday however Bercow’s ruling now decreases May’s chances of getting anything approved by 29th March. Mrs May will be heading to Brussels on Thursday for a summit where the most likely outcome will now be a request to the EU to extend the deadline for potentially a few months or even out for a year. If she manages to thrash out a new deal with the EU and has an opportunity to present it to the Commons, then we could see a resurgence of the pound’s strength.
Todays attention will now draw on the UK’s employment data with the latest unemployment rate forecasted to remain at 4% and wage growth (excl. bonus) forecasted to remain at 3.4%. Any improvement on these figures should cause the pound to climb
?? EUR - The euro drew support as the single bloc’s trade balance increased to €17bn, marking a 9-month high.
In focus today will be the latest ZEW survey on economic sentiment from Germany forecasted to improve slightly.
?? USD - The dollar traded steady yesterday in the absence of any major news flows or data.
Focus still remains on the Fed statement on Wednesday evening, where markets are expecting the interest rate will remain at 2.5% and stick to its pledge of a patient approach to monetary policy.
GBP: Bercow Demands New Deal Must be Agreed with the EU
EUR: Trade Surplus adds to demand for the Euro
USD: Dollar Steady as Markets Wait for Fed Statement
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