Brexit deal is not going well, pound under pressure

Weekly Report - 07/01/2019

Brexit Struggles Continue


The debate about May's Brexit agreement will start this Wednesday including the meaningful vote to be programmed to take place before the end of this month. For the time, for the meaningful vote we have the following dates of 15 or 16 January.

Now the PM Theresa May is, however, trying to find concessions from European directors regarding the backstop. She needs to secure legal insurances, to satisfy the parliament.

Now it's difficult to envision a situation where the Prime Minister's Brexit settlement is capable to find sufficient votes to win over parliament. That means some kind of suspension in both the Brexit itself and the meaningful vote. The Brexit deal, this week will be the important driver, the GBP is expected to be under notable tension.

The Week that was

On Thursday the Yen increased versus its competitors. What is more significant is the popular Japanese currency broke the critical technical support levels. The new global growth risks send most traders into safe haven-assets. The earnings warning from Apple added concerns to investors about declining global growth. Last week Market members went back to the safety of the safe-haven Japanese yen, which rose about 1.5% versus the USD hitting the 107.26 level.


Main Focus This Week

The EUR economic data are weak this week. This Monday the stats include November factory orders out of Germany and retail sales. On Tuesday we have German industrial production numbers and Eurozone’s unemployment rate and also Germany's trade data coming out on Wednesday. For the Pound, we have a busy week ahead. The stats include, first on Monday, December house price figures, On Thursday, December’s BRC retail sales monitor and RICS House Price Balance and on Friday. Now as for the Trade talks this week will be more risk-driven due to news from talks between the two countries.


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