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New PM, still the same Brexit drama! However, the attention could shift to the BOE Super Thursday this week as traders are eager to see if the central bank’s stance shifted.

U.K. manufacturing PMI (Aug. 1, 8:30 am GMT)

Before the BOE kicks things up on Thursday, market watchers will get a glimpse of how the U.K. manufacturing sector has been faring and how it could perform in the months ahead.

The survey results from Markit could show a dip from 48.0 to 47.7 to signal a faster pace of industry contraction. Stronger than expected data, on the other hand, would reflect resilience in the sector even as Brexit concerns linger.

BOE Super Thursday (Aug. 1, starting 11:00 am GMT)

The British central bank is widely expected to keep interest rates on hold at 0.75% and asset purchases unchanged at 475 billion GBP in their upcoming statement, likely coming from unanimous MPC votes.

In a speech last week, BOE Chief Economist Andy Haldane downplayed the odds of a rate cut even if the likelihood of a “no deal” Brexit increased with the new PM. However, BOE head honcho Carney had a few words of caution regarding trade tensions and Brexit-related uncertainty.

With that, the BOE Inflation Report could spark more volatility than usual as pound traders might be quick to react to any possible changes in estimates and rhetoric. Any downgrades in growth and inflation forecasts to account for Brexit uncertainty could up the odds of easing sooner or later.

Brexit developments

And the Brexit drama goes on! So far it has been all about resignations among top officials who aren’t too chipper about new PM Johnson’s openness to the idea of a “no deal” scenario by October 31.

Also keep in mind that the EU has reiterated that they’re not willing to reopen negotiations for the transition deal, which basically makes it a “take it or leave it” situation for the U.K.

In a statement issued last week, the EU noted:

“The (group) notes that recent statements, not least those made during the Conservative Party leadership campaign, have greatly increased the risk of a disorderly exit of the UK. “A no-deal exit would be economically very damaging, even if such damage would not be inflicted equally on both parties.”

Missed last week’s price action? Read GBP’s price recap for July 22-26!