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Sterling rallies on positivity over May-Juncker meeting

May heads to Brussels in a bid to secure changes to the Irish backstop and to salvage her Brexit divorce deal.

Centtrip: Sterling could continue its winning streak if Euro data disappoints

Sterling gained 1.5 cents against the Dollar and reached $1.3076 overnight following Conservative MP Richard Harrington’s suggestion that Parliament could delay the 29 March Brexit deadline to avoid Britain to crash out of the European Union without a deal.

Meanwhile, a lot is riding on Theresa May’s meeting in Brussels with European Commission President Jean-Claude Juncker. The UK prime minister, along with Attorney General Geoffrey Cox and Brexit Secretary Steve Barclay, will try to secure legally binding wording on the Irish backstop, which will appease parliament. However, Jacob Rees-Mogg, the Chair of the European Research Group, warned yesterday that “if it is not in the withdrawal agreement, it will not butter many parsnips”, highlighting just how difficult May’s job will be.

Tonight the Federal Open Market Committee (FOMC) will release the minutes from its January meeting. Market participants will wait for any clues to either the future monetary policy path or interest rate movements.

The Federal Reserve did a U-turn last month, having taken two planned interest rate rises off the table for 2019. The Fed blamed lukewarm inflation and deceleration global growth risks. Today it will become clear whether or not it was a unanimous decision or some FOMC members saw it as a temporary pause, considering the ongoing trade talks between the US and China. Any hint that it is the latter will strength the Dollar.

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