GBP/USD Fundamental Analysis October 16, 2012 Forecast

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GBP/USD Fundamental Analysis October 16, 2012 Forecast

GBP/USD Fundamental Analysis October 16, 2012 Forecast

Analysis and Recommendations:

The GBP/USD is trading at 1.6069 fairly flat on the day, holding close to a one-month low against the dollar and seen vulnerable due to the possibility of more monetary easing from the Bank of England.

Traders were wary that data later in the week – including inflation, jobs and retail sales figures, as well as BoE minutes – could highlight a weak UK economy and add to the risk of the BoE opting for more asset-buying quantitative easing next month. QE is usually negative for the pound as it increases the supply of the currency.

But there was little in the way of UK data or events on Monday and analysts said this was likely to leave the pound tracking movements in the euro and the dollar for now. Across the Atlantic US retail sales skyrocketed. With a week of positive data, it is unlikely that the US Fed will have to add any additional stimulus, helping to support the greenback.

Uncertainty over when Spain may ask for a bailout, a prerequisite for the European Central Bank to start buying its bonds, continued to weigh on the euro and other perceived riskier currencies, including sterling. A breakthrough on Spain looked unlikely at a summit of European leaders this week, with euro zone officials telling Reuters that an aid request from Spain may come in November.

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 October 15, 2012 actual v. forecast

Date

 

Currency

 

 

Event

Actual

 

Forecast

 

Previous

Oct. 15

 

GBP

 

 

Rightmove House Price Index (MoM) 

3.5%

 

 

 

-0.6% 

 

 

AUD

 

 

Home Loans (MoM) 

1.8%

 

1.4% 

 

-0.7% 

 

 

CNY

 

 

Chinese CPI (YoY) 

1.9%

 

1.9% 

 

2.0% 

 

 

CNY

 

 

Chinese PPI (YoY) 

-3.6%

 

-3.6% 

 

-3.5% 

 

 

CNY

 

 

Chinese CPI (MoM) 

0.3%

 

0.4% 

 

0.6% 

 

 

JPY

 

 

Industrial Production (MoM) 

-1.6%

 

-1.3% 

 

-1.3% 

 

 

TRY

 

 

Turkish Quarterly Unemployment Rate 

8.40%

 

8.20% 

 

8.00% 

 

 

CHF

 

 

PPI (MoM) 

0.3%

 

0.2% 

 

0.5% 

 

 

PLN

 

 

Polish CPI (YoY) 

3.8%

 

3.9% 

 

3.8% 

 

 

USD

 

 

Core Retail Sales (MoM) 

1.1%

 

0.6% 

 

1.0% 

 

 

USD

 

 

Retail Sales (MoM) 

1.1%

 

0.8% 

 

1.2% 

 

 

USD

 

 

NY Empire State Manufacturing Index 

-6.2

 

-4.5 

 

-10.4 

 

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

Date

Time

Currency

Event

Forecast

Previous

Oct. 16

09:30

GBP

CPI (YoY) 

2.2%

2.5%

 

09:30

GBP

PPI Input (MoM) 

-0.1%

2.0%

 

09:30

GBP

CPI (MoM) 

0.4%

0.5%

 

09:30

GBP

PPI Input (YoY) 

-0.8%

1.4%

 

10:00

EUR

CPI (YoY) 

2.7%

2.7%

 

10:00

EUR

German ZEW Economic Sentiment 

-16.0

-18.2

 

10:00

EUR

Core CPI (YoY) 

 

1.5%

 

13:30

USD

Core CPI (MoM) 

0.2%

0.1%

 

13:30

USD

CPI (MoM) 

0.4%

0.6%

 

13:30

USD

CPI (YoY) 

1.8%

1.7%

 

13:30

USD

Core CPI (YoY) 

2.0%

1.9%

 

14:00

USD

TIC Net Long-Term Transactions 

 

67.0B

 

14:15

USD

Industrial Production (MoM) 

0.2%

-1.2%

Oct. 17

09:30

GBP

Average Earnings Index +Bonus 

 

1.5%

 

09:30

GBP

Claimant Count Change 

 

-15.0K

Oct. 18

09:30

GBP

Retail Sales (MoM) 

0.4%

-0.2%

 

09:30

GBP

Retail Sales (YoY) 

2.1%

2.7%

Government Bond Auction

Date Time Country 

Oct 16 08:30 Spain 

Oct 16 09:10 Greece 

Oct 16 09:30 Belgium 

Oct 17 09:10 Sweden 

Oct 17 09:30 Germany 

Oct 17 09:30 Portugal 

Oct 17 10:00 Norway 

Oct 17 14:30 Sweden 

Oct 18 08:30 Spain 

Oct 18 08:50 France 

Oct 18 09:30 UK 

Oct 18 09:50 France 

Oct 18 14:30 Sweden 

Oct 18 15:00 US 

Oct 18 17:00 US 

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About:FX Empire Analyst - Barry Norman

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