EUR/GBP Weekly Fundamental Analysis July 16-20, 2012, Forecast

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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 Euro zone and UK

 

Weekly Analysis and Recommendations

The EUR/GBP declined most of the week, with overall market sentiment against anything euro. The euro fell against the USD to a two year low, trading below the 1.2150 number on Friday. This pair tumbled on the weakness of the euro. There was little in the way of supportive eco data except an unexpected blip up in Manufacturing Production in the UK.

Date

Last

Open

High

Low

Change %

Jul 13, 2012

0.7864

0.7903

0.7912

0.7857

-0.49%

Jul 12, 2012

0.7903

0.7896

0.7914

0.7882

0.09%

Jul 11, 2012

0.7896

0.7898

0.7904

0.7871

-0.03%

Jul 10, 2012

0.7898

0.7932

0.7934

0.7893

-0.43%

Jul 09, 2012

0.7932

0.7926

0.7948

0.7915

0.06%

This week there is also very little data to support either currency, but news flow from the EU will be more than enough to suffice.

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 of July 9 – 13 actual v. forecast for Euro, GPB, the Franc, and USD

Date

Currency

 Event

Actual

Forecast

Previous

Jul 9

EUR

Sentix Investor Confidence

-29.6

-26.3

-28.9

 

GBP

BRC Retail Sales Monitor y/y

1.4%

 

1.3%

GBP

RICS House Price Balance

-22%

-15%

-17%

Jul 10

EUR

French Industrial Production m/m

-1.9%

-0.9%

1.4%

EUR

Italian Industrial Production m/m

0.8%

-0.3%

-2.0%

GBP

Manufacturing Production m/m

1.2%

0.1%

-0.8%

GBP

Trade Balance

-8.4B

-9.0B

-9.7B

GBP

NIESR GDP Estimate

-0.2%

 

0.1%

Jul 11

USD

Trade Balance

-48.7B

-48.5B

-50.6B

 

USD

Crude Oil Inventories

-4.7M

-1.3M

-4.3M

Jul 12

EUR

Industrial Production m/m

0.6%

0.0%

-1.1%

 

USD

Unemployment Claims

350K

376K

376K

USD

Import Prices m/m

-2.7%

-1.5%

-1.2%

USD

Federal Budget Balance

-59.7B

-91.7B

-124.6B

Jul 13

CHF

PPI m/m

-0.3%

-0.2%

-0.2%

USD

PPI m/m

0.1%

-0.5%

-1.0%

USD

Prelim UoM Consumer Sentiment

72.0

73.5

73.2

Historical:

Highest: 1.2336 EUR on Jun 29, 2010.

Average: 1.1548 EUR over this period.

Lowest: 0.7950 EUR on May 16, 2012

  

Economic Highlights of the coming week that affect the Euro, GBP, CHF and the USD

Date

Time

Currency

 Event

Forecast

Previous

Jul 16

7:15

CHF

Industrial Production q/q

-7.5%

8.8%

9:00

EUR

CPI y/y

 

2.4%

12:30

USD

Retail Sales m/m

 

-0.2%

12:30

USD

Empire State Manufacturing Index

 

2.3

14:00

USD

Business Inventories m/m

 

0.4%

Jul 17

8:30

GBP

CPI y/y

 

2.8%

9:00

EUR

German ZEW Economic Sentiment

 

-16.9

9:15

ALL

G7 Meetings

   

12:30

USD

CPI m/m

 

-0.3%

13:00

USD

TIC Long-Term Purchases

 

25.6B

13:15

USD

Industrial Production m/m

 

-0.1%

Jul 18

8:30

GBP

Claimant Count Change

 

8.1K

8:30

GBP

Unemployment Rate

 

8.2%

9:00

CHF

ZEW Economic Expectations

 

-43.4

12:30

USD

Building Permits

 

0.78M

12:30

USD

Housing Starts

 

0.71M

14:30

USD

Crude Oil Inventories

 

-4.7M

Jul 19

6:00

CHF

Trade Balance

 

2.48B

8:00

EUR

Current Account

 

4.6B

8:30

GBP

Retail Sales m/m

 

1.4%

12:30

USD

Unemployment Claims

   

14:00

USD

Existing Home Sales

 

4.55M

14:00

USD

Philly Fed Manufacturing Index

 

-16.6

Jul 20

6:00

EUR

German PPI m/m

 

-0.3%

8:30

GBP

Public Sector Net Borrowing

 

15.6B

 

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About: FX Empire Analyst - Barry Norman

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