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Fresh Brexit Uncertainty as Investors Anticipate Today’s Major Parliament Vote

Pound News: UK Government Assurances Help Pound to Firm

Sterling volatility has intensified continuously since last week, as investors expect major developments in the Brexit process over the coming days. Market jitters led to some broad Pound fluctuations yesterday.

In the morning, rumours that today’s meaningful Brexit vote could be delayed led to another Pound selloff. However, investors bought into the Pound towards the end of the day as the government asserted that today’s meaningful Parliament Brexit vote would go ahead as planned.

Today’s vote in Parliament could have a huge impact on the direction the Brexit process takes. If it is blocked as expected, Parliament will hold a vote on no-deal Brexit on Wednesday. If MPs vote against this too, a third vote regarding a possible Brexit delay would take place on Thursday.

 

Euro News: Euro Kept Buoyed as German Trade Stats Impress

Investors have been cooling on last week’s dovish European Central Bank (ECB) news as hopes continue to rise that the Eurozone’s economic outlook is showing signs of improvement. The Euro was steadier yesterday.

This was despite Germany’s January industrial production results unexpectedly contracting, as January trade balance, exports and imports stats all beat forecasts and helped the Euro to avoid fresh losses.

No notable Eurozone data will be published today. However, as the Brexit vote will impact the Eurozone too, today’s Brexit news will likely influence Euro movement as investors await more influential Eurozone stats due later in the week.

 

US Dollar News: Mixed US Data Keeps US Dollar under Pressure

The US Dollar struggled to hold its ground yesterday, being flung around by a volatile Pound as the US currency remained under pressure following last week’s disappointing US Non-Farm Payroll figures.

Yesterday’s US data didn’t do much to change market sentiment for the US Dollar. US retail sales printed just above expectations in January while business inventories met forecasts. Overall the currency remained under pressure from rival strength.

The biggest market focus today will be on Brexit news, which could influence risk-sentiment and the safe haven US Dollar. Today’s US inflation rate figures from February may prove influential as well.

 

Canadian Dollar News: ‘Loonie’ Sensitive despite Risk-Sentiment

The Canadian Dollar was not appealing enough to hold out against a volatile Pound yesterday, but investors still found the currency more appealing than some other major currencies like the US Dollar.

Strong Canadian job stats published at the end of last week, as well as slightly higher risk-sentiment and prices of oil, Canada’s most lucrative commodity, kept the Canadian Dollar afloat.

No notable Canadian data will be published today either. Shifts in oil prices, as well as Brexit news, could influence market risk-sentiment and drive the Canadian Dollar today.

 

Australian Dollar News: Risk-Sentiment Limits ‘Aussie’ Losses

As with the Canadian Dollar, the Australian Dollar would have seen sharper movement versus a volatile Pound yesterday if not for some resilient market demand for riskier trade-correlated currencies.

The Australian Dollar slumped last week on poor growth news. Since then, the ‘Aussie’ has been steadying despite a lack of fresh supportive data published in recent sessions.

Australian Dollar investors will be reacting to the latest business confidence and home loans stats today, as well as any potential shifts in risk-sentiment that could arise from Brexit news.

 

Upcoming Data

Tuesday, 12th March

00:30    Australian NAB Business Confidence

09:30    UK Manufacturing and Industrial Production

09:30    UK Construction Orders

09:30    UK Growth Rate

09:30    UK Trade Balance

12:30    US Inflation Rate

 

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To keep up to date with the Euro, visit the Euro blog in our Currency News section.

 

Adam Wiffen

Senior Currency Broker

aww@fcgworld.co.uk

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