Political Uncertainty keeping the pound in check

Pound/Sterling forecast

Pound exchange have remained relatively stable today despite the on-going Brexit debacle. To highlight how much of shambles this whole process has been seven MP’s have resigned from the Labour Party in protest at Jeremy Corbyn’s approach to Brexit and anti-semitism.

The MP’s who all back a further referendum have reportedly said they will not be launching a new political party but instead will sit in Parliament as an independent group.

As my my colleague Alastair alluded to in his post last week there are a number of potential outcomes as we head towards the key date of the 29th March. He is of the opinion that a deal will be reached, even if it is at the 11th hour, however I am not so sure. For me I believe there isn’t enough time to get a deal in place and I would expect an extension of Article 50 to be seen. If this is the case then I expect the pound to continue to trade in a relatively tight range against the Euro.

What data could impact exchange rates this week?

Of course the on-going Brexit debacle will keep the pound in check and will continue to dominate as we head towards the 29th March. Below I have given an outline of key data this week that could have a more immediate impact on exchange rates.

Tuesday 19th – 09:30 UK unemployment figures. Expected to remain on hold at 2.8%

Tuesday 19th – 10:00 EU construction output. Strong figures forecast up from 0.9% to 2.1% which could see some Euro strength.

Tuesday 19th – 15:00 EU speeches from European Central Bank member Peter Praet

Wednesday 20th – 09:00 EU Markit services PMI

Wednesday 20th – 13:30 US Initial jobless claims

Wednesday 20th – 14:45 US Markit Services PMI

Thursday 21st – 09:00 EU Markit services PMI

Friday 22nd – 10:00 EU Consumer Price Index

Friday 22nd – 15:30 EU ECB President Draghi speech

Friday 22nd – US Fed monetary policy report

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