A busy week ahead with Brexit once again the key focus…
The next 5 days could be pivotal in the ongoing Brexit saga. Not only will further cross-party talks take place between Theresa May and Jeremy Corbyn but the Prime Minister will also attend an emergency EU Summit where it will be decided what type of extension the UK will take on. In addition to this, the week also sees important economic numbers as well as a highly anticipated central bank policy decision.
This week’s developments in the realm of Brexit could well define a path forward for PM May, who is under huge pressure from all sides of the political spectrum. Talks with opposition leader Jeremy Corbyn will reconvene after recent discussions proved unfruitful, even if they were conducted in good spirit. Not many are pinning hopes on the next round of talks producing anything material. The Prime Minister will also head over to Brussels to attend an emergency EU Summit on Wednesday. It’s likely she’ll be offered a 12 month Brexit extension which will be flexible in nature. This implies the UK would be able to leave whenever desired.
Aside from Brexit, economic numbers from the UK will also feature this week. Manufacturing and industrial figures are due for release as well as the monthly snapshot of GDP with the most recent month’s forecast at 0.50%.
Elsewhere, a monetary policy decision will take place out of the European Central Bank on Thursday. With the recent downtick in Eurozone data, many are expecting a dovish performance from President Draghi. The euro has remained weak against its counterparts so far this year, are we in for another round of selling? As usual, the decision on rates and accompanying statement are released at 12.45 followed up by a press conference at 13.30.
In the US, focus will remain on continuing trade talks with China. One crucial piece of economic data crossing the wires this week will be the latest inflation report from March. The Fed reversed course recently, partly due to the lack of inflation running through the economy, after last Friday’s robust jobs report any tick up in prices could shift the world’s largest central bank to a more neutral stance.
Written by Viv Savani. 9:01am, April 8th 2019
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