The long, long, long goodbye

Posted by: Paul Donovan

14 Mar 2019
  • We have long held that the UK could only leave the EU on 29 March if Parliament accepted the government's deal. Practically, that applies if the UK leaves shortly after 29 March. Otherwise a lengthy delay will be necessary. Parliament votes on extending the exit date tonight. There will be a vote on deal/length of delay next week. The interminably tedious process becomes more interminable. It cannot become more tedious.
  • Irish fourth quarter GDP is due. This is not normally a focus, but Ireland is the economy most vulnerable to a disorderly UK-EU divorce. Final consumer price inflation from France and Germany can probably be ignored.
  • US import and export price data is scheduled. This does not include the effect of US President Trump's taxes, as trade taxes hit US consumers after goods have been unloaded. US President Trump offered to meet Chinese President Xi after a trade deal has been agreed – the Chinese are concerned about the US president's love of walking as a form of exercise.
  • Chinese data was mixed. Industrial output (for January and February combined) grew more slowly, perhaps reflecting trade taxes. However, investment spending improved. Global exports are biased to capital spending, so this may boost global trade.