This week’s highlight is no doubt tomorrow’s expected Parliamentary vote on Theresa May’s Brexit deal. All eyes will be on Parliament across the final 2 days of debate, culminating in a vote tomorrow evening. As many will know, it’s widely believed the PM May will be defeated and by a significant amount of votes. From here, we’ll then find out it if the Prime Minister has a ‘plan B’ and, if so, what it is. Recently passed amendments have ensured she must provide a swift response, now within 3 days rather than the standard 21 days.
It’s going to be a bumpy ride for the pound this week. Not only will it be shoved around by the vote itself but it will also have to react to any of its consequences too. This includes the prospect of a ‘no confidence’ motion from opposition leader Corbyn or even a general election, both which would be deemed negative for the pound. On the flip-side, the potential for a 2nd referendum has been slowly increasing, a development which would be significantly positive for Sterling. In addition to this, 2 key UK reports will be released this week, they include; inflation on Wednesday and retail sales on Friday.
Elsewhere, it’s a bit more of a calmer week data-wise. As a result of, what is now the longest US government shutdown in history, numerous US economic reports are not able to be released due to that particular department currently being shut. This means focus will remain on speeches from Federal Reserve members as well as the beginning of earnings week where we’ll find out how US companies are faring up in light of recent rate rises and areas of weakness in the economy.
Written by Viv Savani. 8:43am, January 14th 2019
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