Euro remains lower against the dollar

The euro has been under some pressure against the dollar since Mario Draghi earlier in  the week said the slowdown in the Euro area economy may persist for longer than the ECB previously expected. Having ended last week trading north of $1.1550, the single currency is currently about 2 cents weaker at just over $1.13750

Sterling is little changed against the single currency – trading in an around the 88.5p level – as Theresa May’s government survived a Labour motion of no confidence (by a majority of 19) with the support of the DUP. The PM struck a conciliatory tone afterwards, inviting opposition party leaders to talks to try and find a way forward on Brexit. Labour will be crucial in this regard, though Jeremy Corbyn threw down his red line – May must first rule out a no deal exit – before agreeing to any discussions

The annual rate of CPI inflation in the UK fell in December (mainly reflecting lower oil prices recently) to end 2018 at 2.1%, which is almost a full percentage point lower than at the end of 2017 and well below the growth in economy-wide earnings (which picked up notably during the course of last year)

ECB board member Lautenschlaeger says she still sees a hike in interest rates this year and will wait for the Bank’s staff projections for growth and inflation in March before reconsidering her view

Data due today in CPI and construction output in the Euro area and jobless claims in the US