1. GBP Surges Ahead of Brexit Vote
Today would have been the day that UK MPs headed back to Parliament to place a “meaningful vote” on Theresa May’s deal and put forward any amendments. Unfortunately, May had other plans this week and not only cancelled the vote on her deal before the week even got underway, but also pre-empted the rebellion on Tuesday by proposing a vote on no-deal and an extension on 13 and 14 March. May promised MPs a vote on delaying the UK’s departure from the EU or ruling out a no-deal Brexit, if they reject her deal next month. Mrs May made her statement to MPs about Brexit on Tuesday, amid the threat of a revolt by Remain-supporting ministers. The GBP rallied in late Tuesday trading, adding another 0.1% today to last trade at $1.3265 as of 7:55 GMT.*
2. Oil Prices Surge On Weak Dollar
A subdued USD, OPEC supply cuts and falling US inventories caused oil prices to surge today. Specifically, U.S. crude oil inventories fell by 4.2 million barrels in the week to Feb. 22, to 444.3 million barrels, the American Petroleum Institute (API) estimated in a weekly report on Tuesday. Meanwhile, OPEC has indicated it will continue to withhold supply despite pressure from U.S. President Donald Trump this week to stop artificially tightening markets. U.S. West Texas Intermediate (USOIL) crude oil futures were last at $55.88 per barrel as of 7:50 GMT, up 38 cents, or 0.7 percent, from their last settlement. International Brent crude futures (CL_BRENT) were at $65.66 per barrel, up 32 cents, or 0.5 percent from their last close.**
3. Dollar Stable After Steep Fall
The dollar remained near a three-week low on Wednesday after Federal Reserve Chairman Jerome Powell reiterated that the central bank would stay patient on monetary policy and as the pound rallied. The dollar index against a basket of six major currencies stood at 96.056 after shedding 0.4 percent overnight, when it stopped to 95.948, its lowest since Feb. 5. Powell said on Tuesday that rising risks and recent soft data were unlikely to prevent solid growth for the U.S. economy this year, but that the Fed would remain “patient” in its decisions on further interest rate hikes.***
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*Source: FXStreet Feb 27, 2019 2:48 AM ET
**Source: Reuters Feb 27, 2019 3:53 AM ET
***Source: Blokt Feb 27, 2019 03:07 AM ET
