GBP/USD Fundamental Analysis July 23, 2012, Forecast

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Analysis and Recommendations:

The GBP/USD is trading at 1.5671 as the pound could not hold at the 1.57 price level, sterling is weak, down 0.2% and a mid performer among the majors, as EU worries and domestic public finance data drive concern over the ability of the UK to meet its fiscal targets.  Ongoing austerity and the drive to close the UK’s structural deficit by 2017 have reduced growth, complicating the government’s ability to collect tax revenues.  Looking ahead, expectations for next week’s GDP figures are poor, with a median forecast of -0.2% q/q according to a Bloomberg survey of 31 market participants

The absence of data and a desire to pare risk ahead of the weekend is driving widespread USD strength as we approach the NA session.  JPY is flat and outperforming on the crosses, while CAD, AUD & GBP are underperforming slightly.  EUR is weak against all of the majors and declining as markets continue to focus on developments in Spain.  There are no US data releases today, and headline risk is likely to be minimal in the absence of official meetings.

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 July 20, 2012 actual v. forecast

Date

Time

 

Currency

 

 

 

Event

Actual

 

Forecast

 

Previous

 

 

Jul. 20

02:30

 

AUD

 

 

 

Import Price Index (QoQ) 

2.4%

 

1.5% 

 

-1.2% 

 

 

 

04:00

 

NZD

 

 

 

Credit Card Spending (YoY) 

4.6%

 

 

 

3.9% 

 

 

 

06:00

 

EUR

 

 

 

Estonian PPI (MoM) 

0.00%

 

 

 

0.00% 

 

 

 

07:00

 

EUR

 

 

 

German PPI (MoM) 

-0.4%

 

-0.2% 

 

-0.3% 

 

 

 

07:00

 

EUR

 

 

 

German PPI (YoY) 

1.6%

 

1.8% 

 

2.1% 

 

 

 

08:00

 

DKK

 

 

 

Danish Retail Sales (YoY) 

-1.2%

 

 

 

-0.5% 

  

 

08:30

 

EUR

 

 

 

Dutch Consumer Spending 

-1.90

 

 

 

-2.10 

  

 

09:30

 

GBP

 

 

 

Public Sector Net Borrowing 

12.1B

 

11.0B 

 

16.1B 

  

 

13:30

 

CAD

 

 

 

Core CPI (MoM) 

-0.4%

 

-0.1% 

 

0.2% 

 

 

 

13:30

 

CAD

 

 

 

CPI (MoM) 

-0.4%

 

-0.1% 

 

-0.1% 

 

 

 

13:30

 

CAD

 

 

 

CPI (YoY) 

1.5%

 

2.0% 

 

1.2% 

 

 

 

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

Date

Time

Currency

 Event

Previous

Jul 24

7:00

EUR

French Flash Manufacturing PMI

45.2

7:00

EUR

French Flash Services PMI

47.9

7:30

EUR

German Flash Manufacturing PMI

45.0

7:30

EUR

German Flash Services PMI

49.9

8:00

EUR

Flash Manufacturing PMI

45.1

8:30

GBP

BBA Mortgage Approvals

30.2K

9:00

EUR

Flash Services PMI

47.1

13:00

USD

Flash Manufacturing PMI

52.5

Jul 25

8:00

EUR

German Ifo Business Climate

105.3

 

8:30

GBP

Prelim GDP q/q

-0.3%

10:00

GBP

CBI Industrial Order Expectations

-11

13:00

EUR

Belgium NBB Business Climate

-13.2

14:00

USD

New Home Sales

369K

14:30

USD

Crude Oil Inventories

 

Jul 26

6:00

EUR

GfK German Consumer Climate

5.8

8:00

EUR

M3 Money Supply y/y

2.9%

12:30

USD

Core Durable Goods Orders m/m

0.7%

12:30

USD

Unemployment Claims

 

14:00

USD

Pending Home Sales m/m

5.9%

Jul 27

27th-31st

GBP

Nationwide HPI m/m

-0.6%

All Day

EUR

German Prelim CPI m/m

-0.1%

7:00

CHF

KOF Economic Barometer

1.16

12:30

USD

Advance GDP q/q

1.9%

13:55

USD

Revised UoM Consumer Sentiment

72.0

 

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About:FX Empire Analyst - Barry Norman

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