Sterling rode the proverbial Brexit rollercoaster on Tuesday, seeming to settle somewhere between the day’s optimistic highs and realistic lows.
Pulling back from its midday nadir, once informed by Attorney General Geoffrey Cox’s assertion that little had actually changed regarding the Irish backstop, the pound found itself down just 0.1% against the dollar while still slipping half a percent against the euro. The discrepancy appeared to be due to the US core inflation reading, which undershot expectations at 0.1%.
Theresa May is now almost guaranteed to lose the evening’s ‘meaningful’ vote, with the DUP already stating they will go against the PM’s withdrawal agreement, bringing with them at least 60 Tory ERG MPs. That means attention likely already turns to tomorrow’s ‘no deal’ vote; it’s going to be interesting to see how granular sterling gets in its reactions as Wednesday goes on.
With the pound now in the red but off its intraday lows, the FTSE found itself rising 0.3%, one that returned it to the familiar surroundings of 7150. The DAX, meanwhile, slipped 0.2%, but with the CAC up 0.1%. As for the Dow Jones, it started the session the wrong side of 25600 after falling 75 points.
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