The overall market sentiment is mixed as new virus cases continue rising throughout the world, but most economic indicators came out better than analysts expected. Let’s look at the main market movements.
British businesses don’t believe in no-deal Brexit
The vast majority of UK businesses as well as individuals aren’t ready for a no-deal Brexit due to the fact that they don’t find it probable. That’s what the UK cabinet uncovered in a long-awaited analysis on Tuesday. However, the given attitude could back the disruption if it occurs, the government added.
In London, lawmakers are expected to approve a deal, which would soften the UK’s departure from the word’s number one trading bloc due on March 29. The likelihood of a disorderly departure is still real.
On Tuesday, British Prime Minister Theresa May suggested that next month UK lawmakers would vote in favor of a delay.
Notwithstanding communications from the UK cabinet, there’s still little evidence that British companies are preparing for a no-deal scenario, and evidence ascertains that readiness of medium-sized and small businesses is quite low.
The short time before March 29 wouldn’t enable the UK cabinet to compensate for the outcomes of an undesirable no-deal Brexit.
One-in-for – that’s the likelihood of a no-deal Brexit from financial analysts’ point of view.
In November, Britain’s main financial institution disclosed a worst-case no-deal Brexit scenario, which revealed that the United Kingdom might suffer an even bigger economic hit than during the global financial downtime a decade ago.
Besides this, Tuesday's paper paid attention to the risks to particular industries, regions and individuals from a no-deal Brexit. Eventually, Northern Ireland would be affected harder and also for longer period than the rest of Great Britain on the condition the agreement is finally made.
By the way, other financial analysts stressed that their analysis resulted in rather a downbeat picture for the country’s businesses.
The US NFP will be published on August 7 at 15:30 MT time.
The market sentiment is indeed risk-on today. Stocks, riskier currencies and gold are rising amid the waning US dollar.
Follow the BOE monetary policy and rate statements on August 6 at 14:00 MT time…