GBP – Firmly on the back foot as political risk comes back into focus, following the Government’s first parliamentary defeat over the Article 50 bill.
Whilst Theresa May has insisted that that her plans to trigger Article 50 remain on schedule, the uncertainty seemed to cause investors to sell off the pound.
Manufacturing PMI missed expectations yesterday which is surprising with stronger demand from key UK markets and the weak pound, causing the pound to have a tough day losing ground across the board, back to 6 week lows against the US dollar.
EUR – Remains on back foot also with its own political risk to contend with. Dutch elections in two weeks’ time are seen as the first of three vital elections to the overall Eurozone this year. Strangely data has been positive from the Eurozone the last couple of months, this has done little to help the euro nonetheless.
USD – Is firmly in the ascendency as markets bought into Trump’s first speech to congress on Tuesday night and also the increased possibility of a rate rise at the Federal Reserve meeting in March, with markets now pricing in an 80% chance. The dollar index is back to its highest level since the turn of the year.
