09/03/2018 - EU Hands Down Brexit Ultimatum 


The EU has thrown down an ultimatum to Theresa May in Brexit talks, warning that it will not open discussions about trade or other issues until the Irish border question is solved. Speaking in Dublin alongside the Irish prime minister, European Council president Donald Tusk said talks would be a case of “Ireland first” and that “the risk of destabilising the fragile peace process must be avoided at all costs”.

British negotiators have long been keen to move to discussions about trade and had hoped to do so after the March meeting of the European Council in two weeks, but Mr Tusk's latest ultimatum suggests further delays could be in store. The EU says a withdrawal agreement must be negotiated by October to give it time to ratify the deal before the UK falls out of the bloc in March 2019.

Mr Tusk added that the Good Friday Agreement, had been “ratified by huge majorities north and south of the border”.
The joint report agreed by both sides stated that the UK would maintain regulatory alignment with the EU to prevent a hard border – unless another solution could be found, either specifically for Ireland, or as part of the wider trade deal.


The European Central Bank dropped its easing bias on Thursday, fueling expectations that it will normalize monetary policy in the euro area. Previously the the ECB has stated that it stands ready to increase the level of bond purchases it makes in both duration and/or size, in case the economic outlook deteriorates in the euro zone.

However it removed such statement from its communication Thursday, following a monetary policy meeting, indicating that stimulus in the region could come to an end in the near future. ECB President Mario Draghi said Thursday that the solid economic recovery in the region supported the decision to remove the so-called easing bias.

Key Announcements

09.30 – GBP: Manufacturing Production MoM; Forecast at 0.2% against previous of 0.3%

13.30 – USD: Average Hourly Earnings MoM; Forecast at 0.2% against previous of 0.3%

13.30 – USD: Non-Farm Employment Change; Forecast at 201k against previous of 200k

13.30 – USD: Unemployment Rate; Forecast at 4.0% against previous of 4.1%