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Analysts at Societe Generale offer their view on the pound, in light of the FOMC meeting and the ongoing Brexit chaos.

Key Quotes:

“Wednesday’s FOMC meeting  is being written up as the week’s big event, though a rate change is highly unlikely. We think they’ll confirm that the Fed’s balance sheet run-off will end this year, though they may not give us a lot more detail than that. As for rate policy ‘patience’ is the watchword. ´

The biggest driver, however, will be Brexit. There will be a meaningful vote on Mrs May’s withdrawal agreement tomorrow, but only if she thinks it’s likely to pass. The Times leader says “May woos Brexiteers but still faces defeat” in which case uncertainty drags on. Anything other than no-deal should support sterling, but uncertainty can hold it back for now.”