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

07:30CHF Retail Sales (Y/Y)(DEC, 2018)0.40%-0.50%
08:30CHF SVME PMI(JAN)55.857.8
08:45Markit/ADACI Mfg PMI(JAN)48.849.2
08:50Markit Mfg PMI(FEB)51.251.2
08:55EUR German Manufacturing PMI (M/M)(FEB)49.949.9
09:00Euro-Zone PMI Manufacturing(FEB)50.550.5
09:30GBP PMI Manufacturing(JAN)53.554.2
13:30USD Average Hourly Earnings (M/M)(JAN)0.30%0.40%
13:30USD Average Hourly Earnings (Y/Y)(JAN)3.00%3.20%
13:30USD Non-farm Payrolls(M/M)(JAN)160K312K
13:30USD Private Nonfarm Payrolls (JAN)175K301K
13:30USD Labor Force Participation Rate(JAN)-63.1
13:30United States Unemployment Rate(M/M)(JAN)3.90%3.90%
14:30CAD RBC Manufacturing PMI(JAN)-53.6
14:45USD Manufacturing PMI(JAN)54.954.9
15:00US Manufacturing ISM(M/M)(JAN)54.154.3
15:00USD Michigan Consumer Sentiment(JAN 08)90.790.7
18:00USD 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.