EUR/GBP Fundamental Analysis August 15, 2012, Forecast

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Analysis and Recommendations:

The EUR/GBP is trading at 0.7857 as the euro weakened against the GBP, after positive eco data supported the GBP today (see chart) and rumors of new stimulus to help the housing market, crept into the markets today. The BoE has been very busy over the past few months coming up with creative forms of helping the ailing economy.

Whereas Europe’s growth outlook is weak, inflation is falling and confidence is fragile ‐ not typically the formula for strong currency appreciation. Today’s releases included: Eurozone GDP, which came in as expected, falling  ‐0.2%q/q and  ‐0.4%y/y; while both German and French GDP came in higher than consensus they were both lower than Q1 at 0.3%q/q and 0.0%q/q, respectively. French inflation was slightly softer than expected, while German ZEW (business confidence) unexpectedly dropped to  ‐25.5

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 up to the data analysis and information in our weekly reports.

Economic Data August 14, 2012 actual v. forecast

Date

Time

 

Currency

 

 

 

Event

Actual

 

Forecast

 

Previous

Aug. 14

00:01

 

GBP

 

 

 

RICS House Price Balance 

-24%

 

-23% 

 

-22% 

 

00:50

 

JPY

 

 

 

Tertiary Industry Activity Index (MoM) 

0.1%

 

-0.3% 

 

0.9% 

 

02:30

 

AUD

 

 

 

NAB Business Confidence 

4

 

 

 

-3 

 

06:30

 

EUR

 

 

 

French CPI (MoM) 

-0.4%

 

-0.2% 

 

0.0% 

 

06:30

 

EUR

 

 

 

French GDP (QoQ) 

0.0%

 

-0.1% 

 

0.0% 

 

07:00

 

EUR

 

 

 

German GDP (QoQ) 

0.3%

 

0.2% 

 

0.5% 

 

07:00

 

EUR

 

 

 

German GDP (YoY) 

0.5%

 

1.0% 

 

1.7% 

 

07:45

 

EUR

 

 

 

French Non-Farm Payrolls (QoQ) 

-0.1%

 

-0.1% 

 

0.1% 

 

08:15

 

CHF

 

 

 

PPI (MoM) 

-0.3%

 

-0.2% 

 

-0.3% 

 

09:30

 

GBP

 

 

 

Core CPI (YoY) 

2.3%

 

2.1% 

 

2.1% 

 

09:30

 

GBP

 

 

 

CPI (YoY) 

2.6%

 

2.3% 

 

2.4% 

 

09:30

 

GBP

 

 

 

CPI (MoM) 

0.1%

 

-0.1% 

 

-0.4% 

 

10:00

 

EUR

 

 

 

GDP (QoQ) 

-0.2%

 

-0.2% 

 

0.0% 

 

10:00

 

EUR

 

 

 

German ZEW Economic Sentiment 

-25.5

 

-19.3 

 

-19.6 

 

10:00

 

EUR

 

 

 

Industrial Production (MoM) 

-0.6%

 

-0.7% 

 

0.9% 

 

10:00

 

EUR

 

 

 

ZEW Economic Sentiment 

-21.2

 

-19.1 

 

-22.3 

 

13:30

 

USD

 

 

 

Core PPI (MoM) 

0.4%

 

0.2% 

 

0.2% 

 

13:30

 

USD

 

 

 

Core Retail Sales (MoM) 

0.8%

 

0.4% 

 

-0.8% 

 

13:30

 

USD

 

 

 

PPI (MoM) 

0.3%

 

0.2% 

 

0.1% 

 

13:30

 

USD

 

 

 

Retail Sales (MoM) 

0.8%

 

0.3% 

 

-0.7% 

 

13:30

 

USD

 

 

 

PPI (YoY) 

0.5%

 

0.5% 

 

0.7% 

 

13:30

 

USD

 

 

 

Core PPI (YoY) 

2.5%

 

2.3% 

 

2.6%

 

Upcoming Economic Events that affect the CHF, EUR, GBP and USD

Date

Time

Currency

Event 

Previous

Aug 15

12:30

USD

Core CPI m/m

0.2%

 

12:30

USD

Core CPI m/m

0.2%

 

12:30

USD

Empire State Manufacturing Index

7.4

 

13:00

USD

TIC Long-Term Purchases

55.0B

 

13:15

USD

Capacity Utilization Rate

78.9%

 

13:15

USD

Industrial Production m/m

0.4%

 

14:30

USD

Crude Oil Inventories

-3.7M

Aug 16

9:00

CHF

ZEW Economic Expectations

-42.5

 

9:00

EUR

CPI y/y

2.4%

 

12:30

USD

Building Permits

0.76M

 

12:30

USD

Unemployment Claims

361K

 

12:30

USD

Housing Starts

0.76M

 

14:00

USD

Philly Fed Manufacturing Index

-12.9

Aug 17

6:00

EUR

German PPI m/m

-0.4%

 

8:00

EUR

Current Account

10.9B

 

13:55

USD

Prelim UoM Consumer Sentiment

72.3

Government Bond Auctions

Date  Time  Country 

Aug 15  09:10  Sweden

Aug 16  09:30  UK

Aug 16  15:00  US

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About: FX Empire Analyst - Barry Norman

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