Good morning,

GBP: Speaker interference

Sterling is higher this morning following yet another twist in the ongoing game of Brexit. Speaker Bercow’s decision to not allow another meaningful vote on the government’s Brexit plans unless there are substantive changes has increased the chances that any extension to the Article 50 process is longer than it would have been previously. In the longer term, we feel that the chances of an election have also increased which may be a reason for sterling’s limited gains.

Of course, without a deal or a revocation of Article 50, only an extension can prevent the UK from leaving the European Union without a deal in ten days’ time. Theresa May will head to Brussels on Thursday for a meeting with EU leaders to determine just how long any extension to the Article 50 process will be.

Similarly, that meeting of EU leaders could allow enough of a substantive change to the deal for Speaker Bercow to allow another meaningful vote before March 29th.

Away from Brexit, UK unemployment figures are due this morning. While Brexit has damaged confidence and investment into the UK, we have not seen an impact in the jobs market yet; as long as the wheels remain on the wagon then we do not expect this to change, but businesses and job seekers are right to be wary of just what may be coming down the road.

The UK jobs report is due at 09.30.

AUD: Minutes highlight importance of jobs numbers

The Australian dollar is lower this morning following the overnight publication of the latest Reserve Bank of Australia meeting minutes. The minutes revealed that this Thursday’s employment report is key to expectations moving forward, prompting investors to sell the currency on the belief that a poor report could be enough to push the RBA into cutting rates at its next meeting.

USD: Dollar is still weak ahead of tomorrow’s Fed meeting

The data picture in the US is not quite as important as tomorrow’s Federal Reserve meeting bus today’s latest run of factory orders and durable goods orders are important in their own right. Much like most things in life, there are positive and negative impulses on these releases.

The cessation of tensions around the North American Free Trade Agreement (NAFTA) is an obvious help to US factories but a breakthrough on trade tariffs could be enough to hold over orders in the short term as firms gamble on better conditions in the future.

The dollar is the weakest currency in the G10 this morning ahead of the Federal Reserve meeting tomorrow evening.

Have a great day.