UK PM May returns to Parliament to put forward her Plan B today. Elsewhere, the IMF’s world Economic outlook update is on Monday as the US takes a holiday for Martin Luther King Day.
The pound fell Friday after a weaker than expected Retail Sales number and the latest Brexit concerns. The same rules are in place in regards to the PM . She will not allow the UK to remain in the customs union, a ruling that will not allow a 2nd referendum and is still refusing to rule out a no-deal Brexit. A conversation that started at the back end of last week with her cross party members seems to have fallen on deaf ears, and already been put to bed as a loss making exercise. May’s current strategy seems to be amendments to the Irish Backstop so she can gain full support from both the Tory Brexiteers and DUP.
So, we await events later today for PM May to deliver her Plan B; verbal conditions will not win over the pound. If like many there are no concessions and in the main no real changes then we are looking ever more closer to a No Deal scenario which in the interim will weigh on sterling.
On a slightly more positive tone words form German Chancellor Merkel said that both sides bear responsibility to secure a solution to Brexit . This tone gives us a little hope that the EU do in some way want to play ball.
Away from Brexit a hushed day as the US take holiday for MLK Day. Bank of Japan policy meeting is on Wednesday followed by the ECB on Thursday. With the US Government in shutdown Durable goods and new orders expected the end of the week may be delayed.
Keep your tin hats on and await PM May’s PLAN B if there is one ?
Written by Paul Smithers. 9:17am, January 21st 2019
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