Weekly Market Outlook | 31.03.2017

Keep your eyes on central banks.

The UK government formally served began to process to separate from the EU after 44 years. The British Prime Minister confirmed that the UK had triggered Article 50 of the Lisbon Treaty starting a two year legal negotiation. Rather than a strong reaction one could expect from financial markets, investors shrugged of the historic event. The lack of sustained volatility highlights our core theory that central banks policy remains the primary determinate of asset prices. Our trading strategy remains to short the hype. This week will bring the FOMC and ECB policy meeting minutes which will provide additional insight into respective central banks mind set. However, baring US payroll report the G10 calendar is thin. EU PMI reads will provide further evidence of growth acceleration and indications that temporary pullback in inflation will be short lived.