- Brexit negotiations between the UK and the EU started yesterday with UK Brexit Secretary David Davis and the EU’s chief negotiator Michel Barnier initially discussing expat rights, financial settlements and ‘other separation issues’.
- Following their first day’s work together, Mr Davis and Mr Barnier held a joint press conference in which Davis said talks got off to a “promising start” whereas Mr Barnier was slightly more cautious in tone warning that there will be “substantial consequences” as a result of the Brexit.
- The pair set out the structure of the negotiations – there will be one week of negotiations every month and the process will be complete by March 2019.
- Sterling was largely unmoved throughout the course of the day, trading narrow ranges against both the euro and US dollar.
- GBP/USD remained below 1.28 but only briefly dipped to its low of 1.2722 whereas GBP/EUR trading between a high of 1.1447 and a low of 1.1369, closing at 1.1422.
- Overnight we saw Australia release their monetary policy meeting minutes at 2.30am alongside HPI q/q which came in as expected at 2.2%.
- Sterling has come off this morning following comments by Bank of England governor Mark Carney. Carney set a more dovish tone than expected and stated that “now is not the right time to raise rates”.
- This caused GBP/EUR to fall by half a percent from 1.1419 to 1.1367 and GBP/USD to fall by 0.43% from 1.2736 to 1.2681.
- We are looking at another quiet day on the economic data front with the only data of note coming from the US and Canada.
- This afternoon we will see US current account data at 1.30pm and Canadian wholesale sales m/m at the same time.
|Currency Pair||Interbank Rate||% Change on Day|
|Time (GMT)||Region||Data Release||Forecast||Previous|
|13:30||CAD||Wholesale Sales m/m||0.5%||0.9%|