Newsletter – 7th February 2019

Morning Bulletin

Yesterday

  • Sterling gained by 0.25% on the euro yesterday. The market opened at 1.1349, traded a high of 1.1398 and closed at 1.1381.
  • The Express were reporting that Theresa May has a commons majority for a Brexit ‘Plan C’ devised by an alliance of Brexiteer and Remainer Tory MPs which would include extending Britain’s transition out of the EU by an extra year.
  • PM May held talks with the five largest Northern Irish political parties during her two-day visit to try to reassure people she can secure a Brexit deal that avoids a hard border (BBC).
  • European Council President Donald Dusk said that the EU ‘would insist’ on the Irish backstop. Mr Tusk said there was a “special place in hell” for “those who promoted Brexit without even a sketch of a plan of how to carry it safely”.
  • Bloomberg are reporting that the UK government doesn’t expect to bring a revised Brexit deal back to Parliament by the 13th February. PM May had said she had expected to bring a revised deal back as soon as possible and if this wasn’t done by February 13th then Parliament would have another Brexit debate on the 14th.
  • European Commission President Jean-Claude Juncker reiterated that there can be no unilateral exit from the backstop for the UK. He said that the alternative arrangements cannot replace the backstop and the UK cannot leave the agreement without  the agreement of the EU.
  • US President Donald Trump has backed senior Treasury Department official David Malpass to lead the World Bank.
  • Former Federal Reserve Chair Yellen said that the central bank could possibly cut rates in its next move if global growth continues to slow.
  • Fed’s Powell says the US economy is in a good place.
  • GBP/USD fell by 0.12%, opening at 1.2945, trading a low of 1.2925 and eventually closing at 1.2930.
Overnight
  • New Zealand employment change q/q came in worse than expected at 0.1% vs 0.3%. Unemployment rate also came in slightly short of expectations at 4.3% vs 4.1%.
  • GBP/AUD, GBP/NZD and GBP/JPY are trading at 1.8180, 1.9107 and 141.99.
Today
  • PM Theresa May will start talks today with Brussels over changes to the withdrawal agreement.
  • At 10am we will see the release of the EU economic forecasts.
  • At 12pm the Bank of England is expected to keep interest rates at 0.75% with all 9 members of the MPC voting the keep rates unchanged.

 

Currency Pair Interbank Rate % Change on Day
GBP/EUR 1.1377 -0.04
GBP/USD 1.2905 -0.18
EUR/USD 1.1342 -0.17
AUD/USD 0.7096 -0.11

 

Time (GMT) Region Data Release Forecast Previous
10:00 EUR EU Economic Forecast
12:00 GBP BOE Inflation Report
12:00 GBP MPC Official Bank Rate Votes 0-0-9 0-0-9
12:00 GBP Monetary Policy Summary
12:00 GBP Official Bank Rate 0.75% 0.75%
12:30 GBP BOE Gov Carney Speaks