Good morning,

GBP: Timetable set up for May’s departure

Theresa May’s failure to deliver Brexit has been the elephant in the room for as long as I can remember. With the Commons looking set to vote on her withdrawal agreement again in the first week of June, the Prime Minister will be outlining the specifics around her departure and the Tory leadership race will follow. As per all previous leadership challenges, this will remain a key driver of sterling volatility. Yesterday, one of the worst kept secrets in Westminster was made public when Boris Johnson revealed that he would join that race.

GBP traders will be looking to finish the week on a better note after suffering daily losses against most currency pairs, however, with no economic data to artificially drive volume, the risk of further downside is certainly real.

USD: Second guessing the Fed

The markets spent yesterday afternoon sighing with relief as the prospect of a rate cut towards the end of the year fizzled out; by no means a guarantee, but enough to encourage a good run in USD strength following a traumatic start on Monday.

Have a good weekend.