April 11, 2019 — 2 min read
The Pound is largely unchanged after the European Union granted yet another extension to Article 50 to allow the UK Parliament to find a solution to the current Brexit deadlock. The extension is being dubbed a “Flextension” as the extension could be cut short if Theresa May manages to get her Brexit deal passed through Parliament.
Theresa May has said that the UK will leave the EU latest the end of October 2019 and that she is disappointed that the House of Commons have yet to agree her proposed Brexit deal. During the “Flextension” the UK will be entitled to full EU rights and have full obligations to the Union.
The PM will be keen to still try and get her deal through the UK Parliament before the 22nd of May to avoid the UK having to hold EU elections.
The Euro was also exposed to some dovish and concerning data/rhetoric coming out of the ECB yesterday. It was Mario Draghi’s tone that was most concerning. He said inflation would more than likely decline in the months ahead, as growth is being hampered by protectionism and geopolitics and that ample stimulus is needed. The focus today will be the final readings on French and German inflation.
In the US, inflation for the month of March climbed to 1.9% on an annual basis and was significantly above the previous 1.5% number. The FOMC minutes reflected that interest rates would likely remain unchanged this year however the door was open to rate hikes should the economy improve.
Today we will be watching the jobless claims number for the US.
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