Latest Research

This morning’s UK inflation numbers were below forecasts, although the pound – already lower on the day – didn’t respond much. This is not a surprise whatsoever as the focus remains fixated firmly on Theresa May, with investors expressing their disappointment over the Prime Minister’s latest Brexit plan.

In perhaps one of her last actions as Prime Minister, Theresa May developed a “new” Brexit offer with her Cabinet this morning. In essence, May will offer Parliament a choice on customs arrangements and a vote on a second referendum…IF they pass her withdrawal agreement bill.

As has been the case this week, investors will probably pay less attention to the upcoming data releases, and more so to incoming headlines regarding the US-China trade spat, rising US-Iran tensions and Italy’s budget row with the EU, and, of course, Brexit.

A summary of news and snapshot of moves ahead of the US session.

EUR/GBP has been kind to bulls of late, and the intraday trend remains strong. Yet caution is required on the daily chart given the extended nature of price action.

There was little reaction to today’s UK data. Clearly the focus remains on Brexit. But with the prospects of a softer exit or no Brexit at all, we continue to believe that the pound will be able to climb in the coming weeks and months.

The latest US inflation numbers were again slightly below expectations, causing the Dollar Index to further extend its losses, with the Canadian dollar leading the gains thanks to a much stronger jobs report from the North American nation.

The cable’s losses over the past two days have been due mainly to a rebound in US dollar than weakness in pound, with other GBP crosses remaining near their recent highs.

A summary of news and snapshot of moves ahead of the US session.

The Bank of England meetings in which the bank’s Quarterly Inflation Report is published along with the policy statement and the meeting’s minutes is often referred to as “Super Thursday.” But that title doesn’t apply much these days.

From a technical point of view, the bulls would be encouraged by the pound’s desire to climb back above the $1.30 handle, despite the Dollar Index (DXY) breaking to a new 2019 high above 98.00 last week.

The British pound, which has so far outperformed its major rivals in 2019, has found renewed strength over the past couple of days.