Dollar a little firmer

The dollar is a little firmer after Friday’s stronger than expected jobs report in the US, trading at around $1.1450 against the euro this morning (having dropped to over $1.15 immediately following last week’s Fed meeting). Sterling remains off its recent highs against both the euro and the dollar, at about 87.5p and just under $1.31 respectively, as Theresa May prepares to head to Brussels to seek changes to the backstop she negotiated with the EU

Bond yields in the core markets rose after Friday’s job data, reversing some of their earlier fall though they still ended lower on the week overall (at 2.70% and 0.18% in the case of US and German 10-year yields).  Equity markets rose on the week. continuing their relatively strong start to 2019

Employment in the US rose by a very healthy 304,000 in January, with the gains broad based across sectors of the economy. The unemployment rate nudged up for a second consecutive month, to a still very low 4.0%, but this again reflected an increase in the participation rate as the strong jobs market is attracting people into the labour force in search of work

The Bank of England meets this week and is expected to again keep interest rates on hold amid continuing Brexit uncertainty (and notwithstanding a pick up in weekly earnings growth to its highest level since 2008)

Data due this week includes services PMIs in the major economies tomorrow