04/11/16 - Teresa May Need Parliament Approval to Trigger Article 50

GBP

 

The Pound strengthened across the board yesterday morning after a high court judge rules the Brexit process cannot be started until Parliament has given its backing. The ruling means Theresa May cannot trigger Article 50 without approval from MPs.
 
A spokesman said the government was "disappointed as the country voted to leave the European Union in a referendum approved by Act of Parliament. The Government is determined to respect the result of the referendum. We will appeal this judgement."
 
The case was brought in the aftermath of the EU referendum to determine whether an Act of Parliament needs to be put in place before government triggers Article 50, or whether government has the prerogative to start the UK’s EU withdrawal process by itself.
 
The UK also released strong services PMI data which showed a faster growth of total business activity driven by a stronger expansion of incoming new business. New contracts rose at the fastest rate in nine months. Firms linked new work to new business opportunities, rising international demand linked to the weaker pound, improving market confidence and promotional campaigns.
 
Super Thursday was also positive for the Pound after the Bank of England kept interest rates flat and ramped-up forecasts on inflation and growth.
 
Boosted by household spending and the housing market, the UK economy is expected to grow 2.2 per cent this year - up from the Bank’s previous estimate of two per cent - and then 1.4 per cent in 2017, up from 0.8 per cent.

 

USD

 

Filings for U.S. unemployment benefits unexpectedly rose to the highest level in almost three months, extending increases from a four-decade low. The figures were attributed to a dwindling pool of skilled and experienced job hunters keeps employers from firing workers.
 
The ISM non-manufacturing PMI figure showed the services sector is cooling down. Economists expected to hit 56 in October, according to Thomson Reuters consensus estimates. This represents continued growth in the non-manufacturing sector but at a slower rate, the report said.

 

Key Announcements

13:30 - USD - Average Hourly Earnings m/m expected to increase to 0.3%

13:30 - USD – Non-Farm Employment Change forecast to increase to 174k

13:30 - USD - Unemployment Rate is expected to decrease to 4.9%