The B-word

May (names the) day

There was confirmation on Monday that there is no situation in which sterling might find itself that cannot be made worse by the mention of Brexit. Once again it was the prime minister who tossed the grenade when she named 29 March as the day Article 50 will be activated.

Investors learned two months ago that Article 50 would be triggered "by the end of March" and 29 March fits very neatly into that calendar slot. So Ms May's pronouncement hardly came as a surprise but investors nevertheless felt obliged to react by marking down the pound. Donald Tusk, one of the EU presidents, helped it on its way when he said, in effect, that the first six weeks of the supposedly two-year process would be wasted because negotiations will not begin until May.

Having got off to a strong start, strengthening by half a cent against the euro and the US dollar during the early part of the London session, sterling spent the rest of the day giving it all back. The pound fell by an average of -0.2%, losing half a US cent and a third of a euro cent. The Commonwealth dollars did no better: the Loonie was unchanged against sterling and the antipodean duo were only a few ticks ahead. Their problem was lower prices for metals and coal.

Macron energises the euro

Five candidates for the French president's job spent three and a half hours debating the issues on television yesterday evening. Emmanuel Macron, who describes himself as a progressive liberal, was generally thought to have come out of it best. Investors approved of the result and sent the euro higher.

The current estimation is that Mr Macron and Marine Le Pen, the National Front's candidate, will face each other in the second round run-off, which takes place in early May. Whilst there will continue to be a degree of nervousness about the anti-euro stance of Ms Le Pen, last night's debate did nothing to heighten it.

Across the Pond two regional Federal Reserve presidents were sharing their thoughts about monetary policy. Neel Kashkari, who earlier this month voted against a rate increase, thinks there is no hurry to take rates higher. Charles Even, who voted in favour and thinks there is, anticipates two or three increases this year.

Inflation target taken down

A month ago there was disappointment that headline inflation in the UK failed to match up to the forecast 1.9%. Analysts are more ambitious today, predicting that the consumer price index will have risen by 2.1% in the year to February, exceeding its 2% target.

Following last week's dissenting vote from Kristen Forbes, the inflation data will have regained some of their importance. Investors will be more sensitive than usual if the number is adrift from forecast.

The Bank of England's Mark Carney will be sharing a podium this morning with New York Fed president Bill Dudley. They will be talking about ethics.