· Sterling gained and the euro pared losses, but remained lower on the day, after British Prime Minister Theresa May said on Tuesday that she would ask the European Union for a further delay to Brexit.
May is seeking a delay beyond April 12 to give her time to sit down with the opposition Labour Party in a bid to break the impasse over Britain’s departure.
The pound rallied as much as 0.4% after May’s statement, to trade above the $1.31 line. Previously, it was heading towards the $1.30 levels.
The euro jumped to a U.S. session high of $1.1215 before giving up much of the gains and remaining lower on the day.
The euro has dropped to more than three week lows against the U.S. dollar as investors evaluate international growth prospects with the U.S. and European central banks unlikely to raise interest rates soon.
· International Monetary Fund Managing Director Christine Lagarde said on Tuesday that global growth has lost momentum amid rising trade tensions and tighter financial conditions, but pauses in rate hikes will help boost activity in the second half of 2019.
The global economy is in "a delicate moment," said the International Monetary Fund's managing director, Christine Lagarde.
"The growth is losing the momentum that we had hoped for pretty much across the globe. We have 70 percent of the economy that is slowing down," Lagarde said Tuesday in an interview with CNBC's Sara Eisen at the 13th Annual Capital Markets Summit in Washington, D.C. "The U.S. is not immune to the deceleration anymore."
"I'm still optimistic [about a trade deal] and there are clear impetus for both sides to move forward. It's vitally important," Lagarde said.
She added that based on IMF research, if a 25 percent tariff increase was imposed, it would lead to a 0.6 percent loss of U.S. economic growth and a 1.5 percent loss for the Chinese economy.
"Given that those are the two big giants currently, if you have that kind of negative impact on both, it would weigh heavily on the global economy and it would be bad," Lagarde said.
· The global economy is "highly likely" to fall into a recession if the U.S. and China don't reach a trade deal within three months, according to Moody's Analytics Chief Economist Mark Zandi.
His prediction was based on current "extraordinarily fragile" business sentiment that was a result of a protracted tariff fight between the two largest economies in the world that started last year. The U.S. and China are now negotiating a deal, with representatives from both countries expected to meet in Washington this week.
· U.S. President Donald Trump told Federal Reserve Chairman Jerome Powell “I guess I’m stuck with you” in a recent phone call, the Wall Street Journal reported on Tuesday, underscoring tensions between the White House and the independent central bank.
The Trump administration has repeatedly and publicly blasted the Fed for raising interest rates last year, and on Friday the president blamed the Fed for hurting the U.S. economy and stock market.
· Oil prices on Tuesday hit their highest level so far in 2019, with Brent crude approaching $70 a barrel, on the prospect that more sanctions against Iran and further Venezuelan disruptions could deepen an OPEC-led supply cut.
Brent futures reached a session peak at $69.52 a barrel, the highest since Nov. 13. The global benchmark rose 36 cents, or 0.52 percent, to settle at $69.37 a barrel.
U.S. West Texas Intermediate (WTI) crude rose 99 cents, or 1.61 percent, to settle at $62.58 a barrel, after touching $62.75, its highest level since Nov. 7.
The United States is considering more sanctions against Iran, the fourth-largest producer in the Organization of the Petroleum Exporting Countries (OPEC), an official said.
Reference: CNBC