11th April 2019 Market Update
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🇬🇧 GBP – Halloween could bring about trick or treat for the UK in six months’ time after the EU granted a flextension to the Brexit deadline. The agreement will allow the UK to leave earlier should the Theresa May be able to get her deal agreed by parliament and the UK must hold the elections to the European Parliament and if it fails to do so, the UK will leave on 1st June. Sterling moves were muted following the announcement as it appears that the market priced in an extension
Today the PM will make a statement in the House of Commons and talks are set to continue between the government and Labour. No other data is expected today, and no big moves expected in the sterling markets either.
🇪🇺 EUR – The ECB held interest rates to no real surprise in the afternoon and Mario Draghi stuck an even more pessimistic tone than last month with regards to the outlook of the Eurozone citing threats of US tariffs and Brexit to the Eurozone economy. Draghi also stated that interest rates will not be raised before the end of 2019. The euro fell during the press conference but has recovered since and continued to make gains versus the US dollar – now at the highest level since March 27th.
German inflation figures came in as expected at 1.3% this morning and no further data due today.
🇺🇸 USD – Inflation came in higher than expected in March at 1.9% driven largely by volatile oil prices. The FOMC minutes followed in the afternoon with the Fed reinforcing its dovish stance on monetary policy. The dollar lost a bit of ground following the statement.
No further bits of data today.
GBP: New Brexit Deadline of Halloween
EUR: Dovish Draghi fails to dampen demand for euro
USD: FOMC Fail to Signal clear direction of rate cycle
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