pile of pound coins

Pound back in spotlight

2nd March 2017 Market Update

Get a snapshot of the day’s most important market events and currency movements sent straight to your inbox every morning. Sign up to our Daily Market Report.
 
?? GBP – Firmly on the back foot as political risk comes back into focus, following the Government’s first parliamentary defeat over the Article 50 bill.

Whilst Theresa May has insisted that that her plans to trigger Article 50 remain on schedule, the uncertainty seemed to cause investors to sell off the pound.

Manufacturing PMI missed expectations yesterday which is surprising with stronger demand from key UK markets and the weak pound, causing the pound to have a tough day losing ground across the board, back to 6 week lows against the US dollar.

?? EUR – Remains on back foot also with its own political risk to contend with. Dutch elections in two weeks’ time are seen as the first of three vital elections to the overall Eurozone this year. Strangely data has been positive from the Eurozone the last couple of months, this has done little to help the euro nonetheless.

?? USD – Is firmly in the ascendency as markets bought into Trump’s first speech to congress on Tuesday night and also the increased possibility of a rate rise at the Federal Reserve meeting in March, with markets now pricing in an 80% chance. The dollar index is back to its highest level since the turn of the year.

 

Key Announcements

?? GBP
9:30am: Construction PMI expected to rise marginally.

?? EUR
10:00am: Inflation expected to climb further to 2%.

?? USD
1.30pm: Weekly unemployment claims.

?? CAD
1.30pm: 4th quarter growth expected to slow to 2.1%.

 

Our View:  Markets are moving into risk-off mode again as politics starts to take the front seat again. Politics in both Europe and the UK has seen outflows from the euro and the pound into more safe bets such as the dollar. The pound seems to be worse off at the moment as the Article 50 trigger nears.

 

Find out more about our FX Dealing Service for personal & business international payments. We’re committed to giving all clients the best rate possible, along with flexible and personalised service. Save time and money by reducing risk through a simple and efficient service.

FairFX Dealing Service

 

Share:
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.

Leave a Reply