Mmm… Well… What an interesting day for global FX markets. The day kicked off with the Court of Justice of the European Union confirming the opinion expressed by the Advocate General that Brexit is indeed reversable. Article 50 can be unilaterally reversed by the United Kingdom should it choose to do so. Despite confirming a greater breadth of possible options available to Britain as it negotiates its potential secession from the Union, the rest of the day left the Pound bruised and battered. The Pound has fallen to 18-month lows as the Prime Minister announced to Parliament this afternoon that the Brexit vote would face a considerable setback. After an emergency cabinet meeting at 11:30 this morning, concerns around May’s capacity to push through the vote through the Commons was confirmed, precipitating a spiral in underlying UK markets. The FTSE 100 index simultaneously slipped, led by tumbling financial equities. The headline index closed the day down 0.8% down, confirming investors’ increasing lack of confidence in British investments through this tumultuous time. Concerns surrounding the Indian central bank, volatility and consequent risk-off sentiment offered a great footing for the US Dollar to appreciate. Emerging markets unsurprisingly endured the wrath of animal spirits.
Today’s Global Market:
Discussion and Analysis by Charles Porter
UK Wages Bank of England Governor Andrew Bailey yesterday warned of the pressure on wages that are threatening to lead to a wage price spiral as the effects of inflation on the cost of living together with the 12 consecutive interest rate rises that consumers have experienced. The market has not enjoyed the poor inflation […]
UK inflation – June hike worthy? Yesterday’s inflation data surprised markets. The data was released slightly ahead of European core trading hours. The lighter liquidity available at this time could have resulted in the short-term spike towards 1.2450 on cable and around half a cent to the mid-1.15s within GBPEUR. However, you could, and perhaps […]
International Monetary Fund With no sign of insouciance despite its 180 degree turn in a two month timeframe, the IMF yesterday reversed its downbeat if not disastrous forecasts for the UK and stated the UK is no longer heading for a recession and nor is it the weakest member of the G7 when it comes […]