Prime Minister May will announce further details of the Brexit Bill on Tuesday with parliamentary reaction watched closely.

Trade concerns dominated during Monday with tensions over Huawei’s access to US technology firms reinforcing underlying US-China uncertainty.

Equity markets moved lower as the technology sector came under pressure, although Chinese markets attempted to rally on Tuesday.

Currencies were held in relatively narrow ranges with the US dollar continuing to significant gain net support from a lack of attractive alternatives.

Political concerns continued to sap support for the Euro and Sterling.

The Australian dollar declined after Reserve Bank Governor Lowe stated that a rate cut would be considered at the June meeting.

Oil prices were resilient as underlying supply issues continued to provide support.

Bank of England Deputy Governor Broadbent stated that the underlying investment trend had declined in every quarter during 2018 and that the trend is still negative. The downbeat comments and warning over Brexit uncertainty were significant in maintaining negative Sterling sentiment. Money markets indicated that the potential for a Bank of England interest rate increase this year had declined to 11% from around 30% two weeks ago.

Markets also remained very sceptical that the government would be able to secure approval for the Brexit Withdrawal Bill in parliament. GBP/USD briefly moved above 1.2750 in a correction from recent sharp losses before fading again while GBP/EUR continued lower towards 1.1400.

Prime Minister May will announce further details of the Brexit Bill on Tuesday with parliamentary reaction watched closely. Sterling was unable to make headway and GBP/USD traded around 1.2725 with political and global trade developments likely to dominate during the day.

Economic Calendar

09:30BoE Gov Carney Speaks--
09:30BoE MPC Member Michael Saunders--
09:30GBP BoE Ben Broadbent Speech--
11:00GBP CBI Industrial Trends Orders (MAY)--5
15:00USD Existing Home Sales(APR)-5.21M
15:00USD Existing Home Sales Change(APR)--4.90%
15:00Euro-Zone Consumer Confidence(MAY)--7.9
15:45Fed President Evans Speaks--
17:00FOMC Member Rosengren Speaks--
23:30AUD Westpac Leading Index (M/M)-0.2
23:45NZD Retail Sales (Q/Q)-1.70%
23:45NZD Core Retail Sales (Q/Q)0.90%2.00%

*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.