28th October 2019 Market Update
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🇬🇧 GBP – Today a vote in the House of Commons is expected to be held on whether to hold a snap election on the 12th December. Jeremy Corbyn has been vocal that no deal needs to be taken off the table in order to gain Labour’s support which would be required in order to gain 2/3 of votes in the House of Commons. This lead to Liberal Democrats and the Scottish National Party proposing an early election via an amendment to the Fixed Term Parliament Act law which would mean that the vote could be passed by a simple majority. The pair are campaigning for the an election to take place on the 9th December to give students, who are predominantly pro EU voters, the chance to cast their vote as they will still be at University. Government ministers are expected to reject the proposal with MPs saying it is a saying it is a gimmic to stop Brexit.
Bank of England’s Tenreyro is speaking at 5pm today.
🇪🇺 EUR – European Council President tweeted this morning that EU has agreed to extend Brexit until 31st January 2020. In recent weeks Emanuel Macron had been vocal that the UK should only be offered an extension to complete the Brexit deal till Mid-November, however, the French appear to have softened their stance.
EUR/USD had a 3 week winning streak, it’s best run since January 2018, and gains have been supported by European trade optimism.
ECB President Mario Draghi is speaking at 3pm today.
🇺🇸 USD – Last Friday US Trade Representative’s office claimed “phase one” on the US – China trade deal is almost complete and they hope to sign a deal by mid-November. The South China Morning Post have reported that part of the deal will include a currency clause to ensure the USD/CNY exchange rate remains stable.
Later in the week the Federal Reserve are forecasted to cut interest rates to a 1.75-2% range from a 2-2.25% range at 6pm on Wednesday. This will be the third time interest rates have been cut since Jerome Powell became Chair of the Federal Reserve.
On Friday at 12.30pm US job data is released with Nonfarm payrolls being the headline figure.
GBP: Sterling muted ahead of election vote
EUR: EU Grant Brexit extension to 31st January 2020
USD: Interest rate cut likely on Wednesday
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