Yesterday, British MPs took control of the House and voted on 8 possible ways to move the Brexit process forward. At 3pm, Speaker Bercow chose the options to be voted upon; the range was as expected with the most anticipated motions such as a second referendum and no-deal included. Consistent with the nearly 3 year process, very little clarity was gained from this exercise. MPs rejected all options, pushing Parliament back to square 1 in deciding whether May’s deal is acceptable or not.
Yesterday saw more MPs switch over to backing May’s deal, this time it was the turn of prominent Leaver, Iain Duncan Smith. Sterling edged higher on each announcement of converts to the PM’s plan. This was halted after the DUP once again crushed May by confirming they would not back her. This was even after she informed MPs that she’d stand down should her withdrawal agreement be passed. The DUP are crucial in this equation as many Conservative MPs who are part of the European Research Group are tying their support to the deal on the condition it’s acceptable to the Northern Irish Parliamentarians. The pound lost half-a-cent on the back of these headlines pushing back down to the $1.32 and €1.17 level.
Today sees focus shift back to economic data and, in particular, the health of the US economy as many predict a recession could be around the corner following years of impressive growth. A raft of US numbers will cross the wires around lunchtime: final reading of Q4 2018 GDP, jobless claims, inflation via the Fed’s prefered PCE metric and pending home sales. We’ll also see some key data from the eurozone across the morning session with the highlight being German regional inflation readings.
Written by Viv Savani. 9:06am, March 28th 2019
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8:46am, August 5th 2019
Summer markets proving volatile as fresh week commences…