Yesterday, the markets continued to digest the weekend’s Brexit developments where Conservative voter and Mayor of London Boris Johnson announced that he will be campaigning for the UK to exit the European Union at this June’s referendum. Sterling fell across the board and the decline continued yesterday with GBP/USD falling nearly 2.5% to a low last seen in 2009.
On the economic docket we saw a raft of Eurozone PMI data released. Services and Manufacturing PMI in the region both failed to meet expectations, although remained above the key 50 figure which indicates expansion in the sectors. Services PMI posted a reading of 53.0, whilst Manufacturing registered a 51.0 as the Eurozone powerhouse Germany, continued to struggle last month.
The main focus will be on the Bank of England’s Governor Mark Carney, as he and several MPC members testify on the current outlook of the UK’s inflation before the Treasury Committee. As this is one of the main influences for the BoE’s rate rise plans, any insight into when inflation is likely to hit the 2% target will be watched closely. Across the pond, we have the release of the Consumer Confidence reading later this afternoon.