Newsletter – 20th March 2018

Morning Bulletin


  • Sterling rallied yesterday following news that the UK and EU have agreed on a ‘large part’ of the agreement that will lead to the withdrawal of the UK.
  • The key aspects of the agreement are;
    • The transitional period will last from 29th March 2019 to 31st December 2020.
    • EU citizens that come to the UK during those dates will have the same rights as those who arrived before Brexit and this will be reciprocated by EU countries to UK expats.
    • The UK will still be party to existing EU trade deals with other countries but will be able to negotiate its own trades deals during the transition period.
    • Northern Ireland will remain in parts of the single market and the customs union in the absence of other solutions to avoid a hard border with Ireland.
  • The UK and the EU are hopeful that the terms of the agreement on the transitional period can be signed off by leaders at the EU summit this week.
  • GBP/EUR rallied from 1.1337 to trade a high of 1.1434 before pulling back by the end of the day to close at 1.1368 representing a 0.27% gain on the day.
  • Against the US dollar, there was similar movement with GBP/USD rallying from an opening rate of 1.3935 to trade a high of 1.4088 only for it to pull back and close at 1.4023 which is a 0.63% increase on the day.
  • It was a quiet day in terms of economic data releases with no data of note to report.
  • EUR/USD gained 55 points over the course of the day with the market reacted positively to the transitional deal announcement.
  • Australian HPI q/q came in better than expected at 1.0% vs 0.1% expected.
  • GBP/AUD, GBP/NZD and GBP/JPY are trading 1.8246, 1.9474 and 149.15.
  • UK CPI y/y came in slightly weaker than expected this morning at 2.7% vs 2.8% expected. PPI input m/m came in weaker than expected at -1.1% vs -0.9% expected.
  • Sterling has gained across the board this morning and is currently up 0.18% against the euro and 0.08% on the dollar.
Currency Pair Interbank Rate % Change on Day
GBP/EUR 1.1384 +0.18
GBP/USD 1.4035 +0.08
EUR/USD 1.2325 -0.08
AUD/USD 0.7700 -0.22


Time (GMT) Region Data Release Forecast Previous
10:00 EUR German ZEW Economic Sentiment 13.1 17.8