GBP/USD Monthly Fundamental Forecast November 2012

Outlook and Recommendation

The GBP/USD gained some momentum to close out the month right at the 1.61 range with the actual close at 1.6097. The Q3 GDP read showed the UK emerging from a recession with expansion and retail sales and jobs printed positive at the month end. Traders are re-evaluating their view of the GBP.

Highest:1.6217	Lowest:1.5914	Difference:0.0303	Average:1.6072	Change %:-0.21

The fundamentals and ties into Europe are concerning for GBP; however, as the UK exits recession, the BoE appears likely to end its asset purchase program and the countrys triple-A rating attracts foreign inflows all of which support the pound. As of late October, investors were comfortable with long GBP positions, with the CFTC reporting the net long at US$1.8 billion. Technicals suggest that it will take a significant catalyst to push GBP sustainably above 1.63. The US dollar was also weak towards the end of the month, but as the US looks set for recovery, it may pressurize the pound. There is the all important BoE meeting in the early part of the month and US presidential elections.

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.

Central Bank – The Bank of England

Date of next meeting or last meeting: Nov 08, 2012

Current Rate: 0.500%

Economic events for the month of November affecting EUR, CHF, GBP and USD

Date	Time	Currency	Event	Forecast	Previous
Nov 1	5:30am	GBP	Manufacturing PMI	48.1	48.4
	8:15am	USD	ADP Non-Farm Employment Change	139K	162K
	8:30am	USD	Unemployment Claims	371K	369K
	10:00am	USD	CB Consumer Confidence	72.4	70.3
	10:00am	USD	ISM Manufacturing PMI	51.2	51.5
Nov 2	5:30am	GBP	Construction PMI	49.1	49.5
	8:30am	USD	Non-Farm Employment Change	123K	114K
	8:30am	USD	Unemployment Rate	7.9%	7.8%
Nov 5	5:30am	GBP	Services PMI		52.2
	11:00am	USD	ISM Non-Manufacturing PMI		55.1
Nov 6	5:30am	GBP	Manufacturing Production m/m		-1.1%
Nov 7	4:00am	CHF	Foreign Currency Reserves		429.3B
	4:15am	CHF	CPI m/m		0.3%
Nov 8	8:00am	GBP	Asset Purchase Facility		375B
	8:00am	GBP	Official Bank Rate	0.50%	0.50%
	8:45am	EUR	Minimum Bid Rate	0.75%	0.75%
	9:30am	USD	Trade Balance		-44.2B
Nov 13	5:30am	GBP	CPI y/y
	6:00am	EUR	German ZEW Economic Sentiment
	6:30am	GBP	BOE Inflation Report
	9:30am	USD	Core Retail Sales m/m
	9:30am	USD	PPI m/m
	9:30am	USD	Retail Sales m/m
Nov 15	5:30am	GBP	Retail Sales m/m
	9:30am	USD	Core CPI m/m
	9:30am	USD	Unemployment Claims
	11:00am	USD	Philly Fed Manufacturing Index
	11:00am	USD	Existing Home Sales
Nov 20	9:30am	USD	Building Permits
Nov 21	5:00am	EUR	German Ifo Business Climate
	10:30pm	CNY	HSBC Flash Manufacturing PMI
Nov 22	4:00am	EUR	French Flash Manufacturing PMI
	4:30am	EUR	German Flash Manufacturing PMI
	5:30am	GBP	Public Sector Net Borrowing
Nov 26	5:30am	GBP	Revised GDP q/q
Nov 27	9:30am	USD	Core Durable Goods Orders m/m
	11:00am	USD	CB Consumer Confidence
	11:00am	USD	New Home Sales
Nov 29	9:30am	USD	Prelim GDP q/q
	11:00am	USD	Pending Home Sales m/m
Nov 30	9:00pm	CNY	Manufacturing PMI

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Originally posted here