The Bank of England’s Jonathan Haskel stated that he’d need evidence of higher inflation to convince him to vote to raise interest rates and expressed concerns over the risks to labour-market strength. Despite the dovish rhetoric, the Sterling impact was limited as the market was distracted by political developments. Choppy trading engulfed the Pound with speculation that the DUP was edging towards a deal with the government to support the Brexit Agreement and fresh legal advice which shored up Sterling sentiment.
Political tensions remained extreme. The government avoided defeat on an amendment that would have seen parliament wrest control of the Brexit process, which added some stability.
The government will apply for a short Article 50 extension if an agreement is in place by March 20th, and a longer extension if there is no agreement by that date. Following the defeat of an amendment calling for a second referendum, Sterling registered net losses with a retreat to below 1.3250 against the Dollar while the Euro rallied to 1.1695. Position adjustment is liable to contribute to further volatile Sterling trading today.
The US Dollar Index was up 0.25% under a light economic calendar in yesterday’s trading.
US jobless claims increased to 229,000 in the latest week from 223,000 previously while import prices increased 0.6% for February. New home sales declined sharply to an annual rate of 607,000 for January from a revised 652,000 in December. The overall data impact was limited, with market attention focussed elsewhere. There were no comments from Federal Reserve speakers ahead of next week’s policy meeting with policy expected to remain on hold.
The IFO institute slashed its 2019 German GDP growth forecast from 1.1% to 0.6%, reinforcing underlying concerns and causing the Euro to cede ground at the US open. Brexit tensions remained extremely high, preventing the market from seeing many positives and therefore limiting Euro purchasing. Trading was confined to narrow ranges and the Euro settled around 1.1300 against the Dollar.
Data to watch:
02:00 JPY BoJ Monetary Policy Statement
02:00 JPY BoJ Interest Rate Decision
04:05 CNY FDI - Foreign Direct Investment (YTD) (YoY) (Feb)
N/A JPY BoJ Press Conference
08:55 JPY BoJ’s Governor Kuroda speech
10:00 EUR Consumer Price Index (YoY) (Feb)
10:00 EUR Consumer Price Index - Core (MoM) (Feb)
10:00 EUR Consumer Price Index (MoM) (Feb)
10:00 EUR Consumer Price Index - Core (YoY) (Feb)
13:15 USD Industrial Production (MoM) (Feb)
14:00 USD Michigan Consumer Sentiment Index (M
Posted in Daily Market News on Mar 15 2019
About the author //
With more than 17 years experience in financial services, Head of Sales Rob guides PLCs and sole traders alike through the complex maze that is the foreign exchange market, helping them to save money and mitigate risk.
He has a wealth of experience and knowledge from holding numerous roles including various positions in investment banking and services in Front, Middle and Back offices. This gives him giving a particularly insightful view on customers’ problems and requirements. Rob also helps to keep our clients informed of the latest in the currency world with our daily market commentary.
GBPPhilip Hammond delivered the government’s Spring budget in the run-up to the No-Deal vote. UK GDP growth forecast for 2019 dropped to 1.2% from 1.6%, but lower borrowing forecasts and stronger wages growth negated any negative Sterling impact.VIEW FULL ARTICLE
Posted in Daily Market News on Mar 14 2019 by Rob