Economic calendar: Brexit’s future on the line

Summary:

• UK parliament to vote on Brexit deal in the evening

• Draghi to present ECB 2017 Annual Report

• JPMorgan (JPM.US) and Wells Fargo (WFC.US) among companies reporting earnings today

With just a few readings scheduled for today one could thought that the day is going to be a boring one. However, there is one event planned with a huge potential to move markets - the Brexit vote. The UK parliament will hold a decisive vote in the evening therefore one should expect significant volatility on the GBP tied FX markets. The US data and API oil inventories estimates round up the calendar. Last but not least, euro traders may want to tune in at 3:00 pm GMT as ECB Chairman Draghi will present ECB’s 2017 annual report.

1:30 pm GMT - Data from the United States. Just a few readings from the United States were scheduled for today and neither of them is a typical market mover. The PPI inflation report for December will be released at 1:30 pm GMT and is expected to show producer’s inflation slowing by 0.1% MoM (previously 0.1% MoM). The core print is forecasted to come in at 0.2% MoM (previously 0.3% MoM). Simultaneously, the New York Empire State Manufacturing Index for January will be released and it is seen moving higher from 10.9 pts to 12 pts.

7:00 pm GMT - UK parliament votes on Brexit deal. The UK Prime Minister Theresa May is about to face a final showdown today in the evening when the parliament votes on her Brexit deal. Polls and rumours hint at a tremendous defeat. Theresa May warned yesterday that the failure to back the deal would increase chances of the United Kingdom crashing out of the European Union without a deal in place and even may lead to a split of the United Kingdom. We encourage you to take a look at out analysis of the event that can be found here.

9:40 pm GMT - API data on oil inventories. Brent price moved lower after reaching the long-term resistance zone recently. However, crude may be set to regain its shine as the US Envoy insisted on not granting any more waivers to buyers of the Iranian oil. Apart from that, the outlook for the market will be made more clear in March as OPEC+ is set to meet and assess its production cut agreement.

Central bank speakers scheduled for today:

• 1:15 pm GMT - Riksbank’s Jochnick

• 3:00 pm GMT - ECB Chairman Draghi

• 4:30 pm GMT - Fed’s Kashkari

• 6:00 pm GMT - Fed’s George

• 6:00 pm GMT - Fed’s Kaplan

Major US companies set to report earnings today:

• Wells Fargo & Co (WFC.US)

• JPMorgan (JPM.US)

• UnitedHealth Group (UNH.US)

GBPUSD is marching higher despite expectations of a significant defeat PM May is about to experience today. The pair is slowly approaching the downward sloping trendline that coincides with the 200-session moving average. Today’s vote will surely spur additional volatility therefore one should not rule out a test of the aforementioned trendline in case the outcome turns to be GBP-positive. Source: xStation5