EUR/GBP Weekly Fundamental Analysis – February 8-12, 2016 -Forecast

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Published: Feb 6, 2016, 06:18 UTC

Weekly Analysis and Recommendations The EUR/GBP ended the week up 1.1% as the euro saw unbelievable gains helped by rumors that the ECB might not offer

EUR/GBP Weekly Fundamental Analysis – February 8-12, 2016 -Forecast

Weekly Analysis and Recommendations

The EUR/GBP ended the week up 1.1% as the euro saw unbelievable gains helped by rumors that the ECB might not offer additional stimulus in March. The pound fell after the BoE inflation reports and more headlines on Brexit. The pair ended the week at 0.7690.

Sterling was down 0.7 percent, having hit a one-month high on Thursday after Bank of England chief Mark Carney quashed talk that interest rates could be cut in the coming months.

It was flat against the euro. The single currency, often preferred during times of financial market stress, was steady at 76.80 pence, not far from a one-year high of 77.56 pence struck on Jan. 20.

“We suspect the combination of a June Brexit vote and a shaky risk environment due to emerging market growth concerns will unambiguously weigh on sterling,” said Viral Patel, currency strategist at ING. “We retain our forecast for sterling/dollar to move below $1.40 in the second quarter of 2016.”

Bank of England Deputy Governor Ben Broadbent said there are some signs that low inflation is restraining wage growth and that policy makers are in no hurry to increase interest rates.

Speaking on BBC Radio on Friday, Broadbent said there is “no urgency” to raise the benchmark rate from a record-low 0.5 percent, where it’s been for almost seven years.

His comments echo those of Governor Mark Carney who signaled on Thursday that higher borrowing costs are still some way off as the central bank cut its inflation forecast and the Monetary Policy Committee voted unanimously to maintain emergency policy settings.

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 daily updates and outlooks.

Major Economic Events for the week:


Date	Currency		Forecast
Feb 7	JPY	Current Account	1.59T
Feb 8	CAD	Building Permits m/m
	USD	Mortgage Delinquencies
Feb 9	AUD	NAB Business Confidence
	GBP	Trade Balance	-10.4B
	USD	JOLTS Job Openings	5.54M
	AUD	Westpac Consumer Sentiment
Feb 10	GBP	Manufacturing Production m/m	0.0%
Feb 11	CAD	NHPI m/m	0.3%
	USD	Unemployment Claims	287K
Feb 12	AUD	Home Loans m/m	2.9%
	EUR	German Prelim GDP q/q	0.3%
	EUR	Flash GDP q/q	0.3%
	USD	Core Retail Sales m/m	0.0%
	USD	Retail Sales m/m	0.1%
	USD	Import Prices m/m	-1.4%
	USD	UoM Consumer Sentiment	92.6
Feb 13