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Yesterday

  • UK Inflation rose slightly more than expected in February, with a CPI y/y reading of 1.9%. It had been expected to remain at 1.8% as recorded in January. The modest rise was partially down to a rise in the price of food, alcohol and tobacco.
  • There was very little reaction to this economic data yesterday however as Brexit related matters dominate the performance of the Pound.
  • The Pound was already weak in FX space prior to and following the data however as uncertainty reigned supreme once more. Sterling was under pressure as UK lawmakers were seeking an emergency Parliamentary debate in order to challenge the PM’s announcement that she would only be pursuing a short extension to the Brexit deadline.
  • According to an EU spokeswoman, European Commission President Juncker had warned Theresa May against pushing for an extension beyond EU elections unless the UK was prepared to take part themselves.
  • Cranking up the pressure ahead of the big Summit, yesterday afternoon the European Council President Donald Tusk said the short delay being proposed by Theresa May could only be granted if her Brexit Deal, which has already been rejected twice, gets passed through the commons at the third time of asking.
  • By 6pm the Pound was down -0.86% against the Euro, trading at 1.1585.
  • Losses against the US Dollar were slightly more limited, with the Pound down -0.35%, trading at 1.3217.
Overnight

  • UK PM Theresa May addressed the nation live yesterday evening, and whilst there was nothing unexpected in her speech, Mrs May confirmed she would be asking the European Union for an extension to the Brexit process to the 30th June. The PM added it was a matter of great personal regret that the process should be delayed and told the nation she was on their side, blaming the delay on fellow MP’s for being indecisive.
  • The Pound fell in FX space following Mrs May’s speech as it did once again appear to put a potential no-deal Brexit firmly back on the table.
  • Following their two-day policy meeting, the US Federal Reserve concluded that they see no reason to hike interest rates any further in 2019 amid signs of a slowdown in the economy.
  • The irony of course is that President Trump will finally get his wishes for the Fed to stop hiking interest rates, but the reasoning of course is down to a lowering of economic growth forecasts for the US economy.
  • New Zealand GDP q/q 0.6% as expected.
  • Australia Employment Change 4.6K (14.8K Exp)
  • Australia Unemployment Rate 4.9% (5.0% Exp)
Today
  • Theresa May is set to meet European Leaders in Brussels for a summit later today. Mrs May will be looking to use the summit to push for a short extension to Article 50.
  • Plenty of UK data this morning followed by the Bank of England’s Monetary Policy Meeting with their rate decision and accompanying statement to be released at 12pm.

MAJOR CURRENCY PAIRS
Current at time of distribution

Currency Pair Interbank Rate % Change on Day
GBP/EUR 1.1552 +0.03
GBP/USD 1.3174 -0.13
EUR/USD 1.1402 -0.09
AUD/USD 0.7140 +0.37
ECONOMIC CALENDAR
Current at time of distribution
Time (GMT) Region Data Release Forecast Previous
09.30 GBP Retail Sales m/m -0.4% 1.0%
09.30 GBP Public Sector Net Borrowing -0.3Bn -15.8Bn
12.00 GBP BOE Official Bank Rate 0.75% 0.75%
12.00 GBP BOE Bank Rate Votes 0-0-9 0-0-9
12.00 GBP BOE Monetary Policy Summary 109.1
12.30 USD Philly Fed Manufacturing Index 4.6 -4.1
12.30 CAD Wholesale Sales m/m 0.5% 0.3%
12.30 USD Unemployment Claims 226K 229K
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