In yesterday’s Brexit debate, Parliament rejected the Government’s motion seeking to reaffirm support for May’s plan. The focus now is very much on the parliamentary debate on Feb 27, widely seen as a crucial date in deciding the eventual outcome.
Meanwhile, the UK economy continues to weaken, with growth at its lowest since 2012. Inflation has dropped to 1.8%, below the Bank of England’s 2% target for the first time since 2017.
In the US, trade talks with China are making slow progress, with the dollar continuing to benefit from its safe-haven status.
On the exchanges, sterling remains under pressure following last night’s parliamentary vote.
GBP/USD has dropped to 1.2800 on the political uncertainty, as time continues to run out ahead of the March 29 exit date. There remains strong buying interest at 1.2750, with 1.3050 the initial topside level to watch.
GBP/EUR is back below the 1.1400 pivot level. There remains strong buying interest at 1.1250, whilst the recent high of 1.1600 continues to cap the topside for now.
EUR/USD has dropped to a year-to-date low of 1.1250, helped by general dollar strength, and a continuation of a weakening European economy.
|19/2/19||UK Average Weekly Earns. 3M/YoY||3.4%||3.5%|
|19/2/19||UK Unemployment Rate||4.0%||4.0%|
|22/2/19||EU CPI YoY||1.6%||1.4%|
|Indices||Previous Close||YTD % Change|
|DFM GENERAL INDEX||2533||+0.12%|
UK Benchmark Rates
|3 month||0.86725%||2 year||1.04%|
|6 month||0.98975%||3 year||1.09%|
|12 month||1.12938%||5 year||1.18%|
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