GBP up 300 pips on Johnson Triple Blow

USD extends broad selloff, US manufacturing deepens woes alongside Europe's but it's Boris Johnson's Triple defeat in Parliament that's dominating FX -- sending GBPUSD up by 300 pips from Tuesday's lows. The UK Prime Minister Johnson denied in a pair of votes that blocked a no-deal Brexit and an early election. US ADP on private sector jobds and services ISM are due on Thursday. Below is the week's Premium video detailing the importance of 3 years in grasping key patterns in equity indices.

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(1) Boris Johnson's was damaged yesterday as the Conservatives officially lost majority in power following the defection of a Tory MP to LibDems. Today: (2) Johnson was denied by a motion blocking a no-deal passed by rebels MPS, followed by (3) his call for an election next month being rejected by MPs.

Over the past two days, Cable shot up to 1.2255 from Tuesday's 1.1958 low. The combination of eording chance of a no-deal Brexit with broadening USD weakness have conspired into fuelling cable. An election is inevitable, a no-confidence on Boris Johnson isn't ruled out and two-way risk is very much present.

On Tuesday, US ISM manufacturing index underscored that global manufacturing has moved from slowdown to recession. The US index fell to 49.1 compared to the 51.2 estimate. It has been a dramatic slide from a cycle high of 61 last August and coincides with a decline in nearly every developed country. The index faces more trouble ahead with the measure of new orders falling to the lowest since 2012.

The ECB continues to simmer in the background with Villeroy adding to the growing list of voices against more QE. A report suggested the ECB is preparing a package of a rate cut, longer guidance and tiering. The central bank is now in its quiet period.

The Bank of Canada held rates at 1.75% but the statement wasn't as dovish as expected and the loonie jumped. The main guidance of the statement continues to say that the current level of accommodation is appropriate while warning about 'global developments' taking a toll on the domestic economy. Schembri will offer further clarity in the day ahead but the commentary suggests the BOC is less likely to cut in October than the 62% priced into the market.

Thursday features a heavy focus on US data with ADP, factory orders and the services ISM all to come.