EncoreFX’s daily market updates are written by our experienced and professional dealing team.
The pound has made the biggest gains overnight and reversed all of yesterday’s losses after PM Theresa May’s second defeat, as lawmakers voted against a no-deal exit this morning.
UK MPs Vote For Ruling Out No-Deal Brexit
British lawmakers have rejected exiting the European Union without a deal in any scenario by a narrow 312 to 308 votes. It is not a legally-binding decision and does not rule out the UK leaving the EU, however, will increase pressure on PM May to rule out a no-deal exit and MPs could get a vote on delaying Brexit from 29th March until 22 May 2019 so there can be a “managed no-deal” Brexit. This vote is now scheduled to take place tomorrow and the EU will still need to agree to any extension. Potential for more pound-positive outcomes, with either a soft Brexit or a second referendum.
USD Gets a Lift on US Durable Goods
US durable goods orders surprised to the upside in January, with a 0.4% increase. Support for the USD however, was limited as producer prices barely rose in February leaving forecasts for weak first-quarter economic growth intact and supporting the Federal Reserve’s patient stance on raising interest rates.
Japan Core Machinery Orders Fall as Trade War Hits Spending
Japan’s core machinery orders were down 5.4% for the month of January vs expectations of a 1.7% decrease. Orders from non-manufacturers slumped 8% in January from the previous month and the fastest decline in four months. The sharp fall in orders is largely due to businesses pulling back from investing amid growing uncertainty over the US-China trade war.
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