bank of england

Sterling continues to climb as Brexit no deal gets ruled out

14th March 2019 Market Update

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🇬🇧 GBP –  Sterling hit the peaks of Monday after Parliament voted against the threat of a no deal on 29th March. Focus today will now be at 5pm, where parliament will vote on a motion that sets Wednesday 20th March as the deadline for MP’s to pass a third vote on a Brexit deal. If that is passed, then the government will seek and an extension of article 50 until 30th June. If the motion is not passed, then government will need to request a longer extension.

As we have seen in previous Brexit scenarios, a short time spike was seen on GBP before dropping off this morning as markets still need to digest the longer-term headwinds that this may all cause.

🇪🇺 EUR – The euro continued its 5-day winning streak yesterday against the US dollar managing to recover the losses that we saw in last weeks ECB meeting. This could well continue into the end of the week as momentum in trade flows continues to support the currency.

German inflation figures disappointed this morning dropping to 1.5% causing some of the wind to be knocked out of the euros sails but nonetheless this looks like a short-term fall before the current trend continues.

🇺🇸 USD –  US durable goods orders came in higher than expected at 0.4% giving the dollar a bit of a boost yesterday but other than that very little was out from the US

Minimal news today from the US.

 

Summary:
GBP: Brexit no deal gets ruled out in Parliament, chances of an extension increase.
EUR: Euro continues to gain momentum erasing last Thursday’s losses.
USD: Durable goods figures support dollar

 

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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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