Introduction: The cross tends to move in ranges, with relatively clear barriers. The narrower ranges made it somewhat harder, but it seems to return to wider ranges. The GBP is does not seem to move in response to the EUR as directly currently. The UK austerity program vs. The EU debt crisis seems to have them moving in opposing distances. They are developing new trading personalities and there is a good deal of profit to be made trading this pair. They can be volatile.
- The interest rate differential between the European Bank(ECB) and the Bank of England(BoE)
- European and UK economic data
- Growth differentials between the Eurozone and UK
Weekly Analysis and Recommendations
The EUR/GBP is trading at 0.8136 up from its opening on Monday of 0.8055. The euro gained all week, on hopes for some resolve from the EU Summit. Even strong eco data in the UK with jobs and retail sales reporting well above forecast, could not trump the strength of the euro leading into the Summit. Markets were sure Spain would request a bailout and Greece would be resolved. When the Minister’s departed the Summit outside of moving forward on banking supervisor little else in the near term seemed to be accomplished.
Date
|
Last
|
Open
|
High
|
Low
|
Change %
|
Oct 19, 2012
|
0.8136
|
0.8140
|
0.8147
|
0.8122
|
-0.05%
|
Oct 18, 2012
|
0.8140
|
0.8126
|
0.8147
|
0.8110
|
0.17%
|
Oct 17, 2012
|
0.8126
|
0.8127
|
0.8130
|
0.8108
|
-0.01%
|
Oct 16, 2012
|
0.8127
|
0.8064
|
0.8137
|
0.8062
|
0.78%
|
Oct 15, 2012
|
0.8064
|
0.8055
|
0.8078
|
0.8040
|
0.10%
|
The GBP remained weak as the BoE is expected to inject additional stimulus this week, reducing the value of the pound. Also 3rd quarter GDP is due. The big event for this pair will be Mr. Draghi’s speech on Tuesday.
FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more recent analysis and information in our weekly reports and we provide dailyupdates and outlooks.
Major Economic Events for the week of October 15-19, 2012 actual v. forecast for Euro, GPB, the Franc, and USD
Date
|
Currency
|
Event
|
Actual
|
Forecast
|
Previous
|
Oct. 15
|
GBP
|
Rightmove House Price Index (MoM)
|
3.5%
|
-0.6%
| |
CHF
|
PPI (MoM)
|
0.3%
|
0.2%
|
0.5%
| |
USD
|
Core Retail Sales (MoM)
|
1.1%
|
0.6%
|
1.0%
| |
USD
|
Retail Sales (MoM)
|
1.1%
|
0.8%
|
1.2%
| |
USD
|
NY Empire State Manufacturing Index
|
-6.2
|
-4.5
|
-10.4
| |
Oct. 16
|
GBP
|
Core CPI (YoY)
|
2.1%
|
2.1%
|
2.1%
|
GBP
|
CPI (YoY)
|
2.2%
|
2.2%
|
2.5%
| |
GBP
|
PPI Input (MoM)
|
-0.2%
|
-0.1%
|
1.9%
| |
GBP
|
CPI (MoM)
|
0.4%
|
0.4%
|
0.5%
| |
GBP
|
PPI Input (YoY)
|
-1.2%
|
-0.8%
|
1.1%
| |
EUR
|
CPI (YoY)
|
2.6%
|
2.7%
|
2.7%
| |
EUR
|
German ZEW Economic Sentiment
|
-11.5
|
-15.0
|
-18.2
| |
EUR
|
ZEW Economic Sentiment
|
-1.4
|
-1.1
|
-3.8
| |
EUR
|
Core CPI (YoY)
|
1.5%
|
1.6%
|
1.5%
| |
USD
|
Core CPI (MoM)
|
0.1%
|
0.2%
|
0.1%
| |
USD
|
CPI (MoM)
|
0.6%
|
0.5%
|
0.6%
| |
USD
|
CPI (YoY)
|
2.0%
|
1.9%
|
1.7%
| |
USD
|
Core CPI (YoY)
|
2.0%
|
2.0%
|
1.9%
| |
USD
|
TIC Net Long-Term Transactions
|
90.0B
|
45.3B
|
67.2B
| |
USD
|
Industrial Production (MoM)
|
0.4%
|
0.2%
|
-1.4%
| |
Oct. 17
|
GBP
|
Average Earnings Index +Bonus
|
1.7%
|
1.6%
|
1.6%
|
GBP
|
Claimant Count Change
|
-4.0K
|
-1.0K
|
-14.2K
| |
USD
|
Building Permits
|
0.894M
|
0.810M
|
0.801M
| |
USD
|
Housing Starts
|
0.872M
|
0.770M
|
0.758M
| |
Oct. 18
|
GBP
|
Retail Sales (MoM)
|
0.6%
|
0.4%
|
-0.1%
|
GBP
|
Retail Sales (YoY)
|
2.5%
|
2.1%
|
2.5%
| |
EUR
|
Spanish 10-Year Obligation Auction
|
5.458%
|
5.666%
| ||
USD
|
Initial Jobless Claims
|
388K
|
365K
|
342K
| |
USD
|
Continuing Jobless Claims
|
3252K
|
3275K
|
3281K
| |
USD
|
Philadelphia Fed Manufacturing Index
|
5.7
|
1.0
|
-1.9
| |
Oct. 19
|
USD
|
Existing Home Sales
|
4.75M
|
4.75M
|
4.83M
|
Historical: From 2010 to Present
Highest:0.9150 EUR on March 01, 2010.
Average:1.1548 EUR over this period.
Lowest:0.7758 EUR on July 22, 2012
Economic Highlights of the coming week that affect the Euro, GBP, CHF and the USD
Date
|
Time
|
Currency
|
Event
|
Forecast
|
Previous
|
Oct. 24
|
07:58
|
EUR
|
44.0
|
42.7
| |
08:28
|
EUR
|
48.0
|
47.4
| ||
09:00
|
EUR
|
101.6
|
101.4
| ||
09:00
|
EUR
|
109.7
|
110.3
| ||
09:00
|
EUR
|
94.3
|
93.2
| ||
11:00
|
GBP
|
-8
| |||
15:00
|
USD
|
385K
|
373K
| ||
Oct.26
|
07:00
|
EUR
|
5.9
|
5.9
| |
08:00
|
CHF
|
1.67
|
1.67
|
Government Bond Auction
Date Time Country
Oct 22 09:10 Norway
Oct 23 08:30 Spain
Oct 23 14:30 UK
Oct 23 17:00 US
Oct 24 09:10 Sweden
Oct 24 09:30 Germany
Oct 24 14:30 Sweden
Oct 24 15:30 Italy
Oct 24 16:30 US
Oct 25 00:30 Japan
Oct 25 09:10 Sweden
Oct 25 15:30 Italy
Oct 25 17:00 US
Oct 26 09:10 Italy
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