Sterling was unable to make headway in early Europe on Thursday with markets still fretting over the evidence of deadlock within Brexit negotiations.

Month-end pressures triggered currency volatility around Thursday’s European close.

After further losses, the dollar recovered some ground as other major currencies were unable to take full advantage of underlying US vulnerability and the dovish Fed.

Dovish rhetoric from Bundesbank head Weidmann undermined the Euro with EUR/USD dipping back below 1.1450.

Oil prices retreated from 2-month highs in choppy trading as global growth concerns undermined support. Commodity currencies and Sterling also failed to sustain gains.

Global equities were resilient with expectations of dovish global central bank policies.

Sterling was unable to make headway in early Europe on Thursday with markets still fretting over the evidence of deadlock within Brexit negotiations as the EU maintained an uncompromising stance on re-opening the Withdrawal Agreement.

The UK currency regained some ground late in the European session following reports that any government promise of additional development funds to deprived areas could persuade several Labour MPS to vote for the Brexit deal. There were still no expectations of a short-term breakthrough with further speculation that the withdrawal date would be extended.

Sterling was also underpinned by a solid tone in risk appetite and fresh gains in oil prices, although gains faded quickly as sentiment remained cautious. GBP/USD failed to hold above 1.3150 and retreated to around 1.3100.

For January, Sterling posted the sharpest gain for a year and EUR/GBP bounced towards 1.1450 with little net Sterling change on Friday.

Economic Calendar

Expected Previous
07:30 CHF Retail Sales (Y/Y)(DEC, 2018) 0.40% -0.50%
08:30 CHF SVME PMI(JAN) 55.8 57.8
08:45 Markit/ADACI Mfg PMI(JAN) 48.8 49.2
08:50 Markit Mfg PMI(FEB) 51.2 51.2
08:55 EUR German Manufacturing PMI (M/M)(FEB) 49.9 49.9
09:00 Euro-Zone PMI Manufacturing(FEB) 50.5 50.5
09:30 GBP PMI Manufacturing(JAN) 53.5 54.2
13:30 USD Average Hourly Earnings (M/M)(JAN) 0.30% 0.40%
13:30 USD Average Hourly Earnings (Y/Y)(JAN) 3.00% 3.20%
13:30 USD Non-farm Payrolls(M/M)(JAN) 160K 312K
13:30 USD Private Nonfarm Payrolls (JAN) 175K 301K
13:30 USD Labor Force Participation Rate(JAN) - 63.1
13:30 United States Unemployment Rate(M/M)(JAN) 3.90% 3.90%
14:30 CAD RBC Manufacturing PMI(JAN) - 53.6
14:45 USD Manufacturing PMI(JAN) 54.9 54.9
15:00 US Manufacturing ISM(M/M)(JAN) 54.1 54.3
15:00 USD Michigan Consumer Sentiment(JAN 08) 90.7 90.7
18:00 USD Baker Hughes US Oil Count - 862

*All rates shown are indicative of interbank rates and should only be used for indication purposes only. It is important to note that foreign exchange rates fluctuate and that rates may vary depending on the amount and the base currency that is purchased or sold. Rates are correct as of 8:00am UK time. CentralFX are not responsible for the rates shown.