This morning, British Prime Minister Theresa May asked the European Union to delay Brexit until June 30th, despite the offer from the president of the European council, Donald Tusk, to extend article 50 for a whole year, with an option to end it early if a deal is agreed. According to him, this flexible extension, “flextension”, would avoid having to consider extra delays every few weeks. Last month, the government requested the same short delay but EU leaders in Brussels rejected it. The pound weakened following the news but remains relatively stable, trading at 1.1650 against the EUR and around 1.31 against the greenback. The market is still pricing in a soft Brexit but any Brexit-related news could however change the pound’s trend.
Investors will also focus today on the very important monthly US non-farm payrolls report, which will provide more information about the state of the US labour market through statistics on job creation, unemployment, average hourly earnings, etc. Investors are particularly interested in these readings as it also provides the latest health check on the US and the global economy. Last month, the report showed a shocking drop in a long run of strong job figures. The economy saw an additional 20,000 jobs only, the smallest increase since September 2017 but the forecast for March is an addition of 180,000 workers. The US dollar is likely to be volatile this afternoon as the results come out.
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