Pound Sterling (GBP) Slumps as Speaker Rejects Third Brexit Vote
The Pound (GBP) fell back against the majority of its peers yesterday, with investors shunning the UK currency as UK Parliament Speaker John Bercow refused to allow Theresa May to bring her deal to a vote again this week.
With the deal seemingly unchanged from last week’s vote, the Speaker said it would violate a convention dating back to 1604, scuppering the PM’s attempt to push a third vote on her deal ahead of the latest EU Summit.
Potentially shifting the focus from Brexit today will be the release of the UK’s latest labour report, with Sterling likely to face further losses if headline wage growth slowed in line with expectations in January.
GBP/EUR Exchange Rate Slides as Eurozone Trade Figures Beat Expectations
The Pound Euro (GBP/EUR) exchange rate fell sharply on Monday as some better-than-expected trade figures from the Eurozone helped to lift the single currency.
While the Eurozone’s trade surplus narrowed sharply from €17b to just €1.5bn in January, this was still well ahead of an expected deficit of -€8bn, allowing the Euro to fully take advantage of Sterling weakness yesterday.
However the Euro may struggle to replicate its success today, with the latest ZEW economic surveys expected to show that economists are becoming increasingly pessimistic in their outlook for the Eurozone.
GBP/USD Exchange Rate Losses Trimmed by Fed Caution
While the Pound US Dollar (GBP/USD) exchange rate fell back yesterday, the pairing’s losses were capped somewhat as investors sought to limit their positions in the ‘Greenback’ ahead of the Federal Reserve’s latest policy decision.
The Fed is expected to adopt a more dovish outlook following this week’s policy meeting, with economists forecasting that the US central bank will drop any suggestions of multiple rate hikes in 2019.
However, ahead of the meeting will be the release of the latest US factory orders figures, with an acceleration in order growth in January potentially offering some support to the US Dollar this afternoon.
GBP/CAD Exchange Rate Dips as Oil Prices Climb
The Pound Canadian Dollar (GBP/CAD) exchange rate fell over half a cent on Monday, with the oil sensitive ‘Loonie’ advancing as US crude prices rose over 1% as the crisis in Venezuela continues to threaten global oil supplies.
GBP/AUD Exchange Rate Rallies as Australian House Prices Plummet
After falling throughout Monday’s session, the Pound Australian Dollar (GBP/AUD) exchange rate rebounded overnight, climbing around half a cent after Australian House Prices were shown to have plummeted a sizeable 5.1% in 2018.
GBP/NZD Exchange Rate amid NZ GDP Worries
The Pound New Zealand Dollar (GBP/NZD) exchange rate also rallied overnight on Monday, with the ‘Kiwi’ stumbling ahead of the latest domestic GDP release this week over fears that growth could undershoot expectations.
Meanwhile NZD may come under additional pressure later this afternoon if prices continue to fall at the latest global dairy auction.