Sterling was again hampered by political unease as Brexit deadlock persisted.

US employment data was mixed with a stronger than expected increase in headline non-farm payrolls offset by subdued growth in wages.

Reaction was limited with the dollar generally resilient as yield spreads remained attractive and other major currencies struggled to attract support. Dollar non-commercial longs increased to 4-month highs, limiting the scope for further buying

Sterling was again hampered by political unease as Brexit deadlock persisted, although it did recover from intra-day lows.

Oil pushed to 5-month highs as Libyan concerns added to underlying supply concerns, but a reported decline in employment hampered the Canadian dollar.

The UK Halifax house price index recorded a 1.6% decline for March with the annual increase held to 2.6%, maintaining concerns over weakness in the housing sector, although political developments still dominated.

Dutch Prime Minister Rutte suggested that Prime Minister May’s letter to the EU was not enough to provide a further extension and that he hopes the UK would provide greater clarity ahead of the EU Summit. Sterling was also hampered by a lack of positive rhetoric surrounding Brexit talks between the government and opposition Labour Party.

GBP/EUR moved above 1.1600 while GBP/USD declined sharply to lows below 1.3000 before finding some support. The UK currency gained some protection from fresh gains in oil prices and an element of optimism over the global growth outlook. There were no substantive political developments over the weekend with talks set to resume on Monday. Markets took a slightly more optimistic stance with GBP/USD back above 1.3050 and EUR/GBP just above 1.1600.

Economic Calendar