EUR/GBP Fundamental Analysis April 6, 2012, Forecast

Analysis and Recommendations:

The EUR/GBP  is holding at 0.8253 dropping since the open at 0.8271. The euro continued to fall against its trading partners as worries over borrowing costs for Spain and Italy continue to upset investors.

Spanish and Italian bond yields continued to rise on Thursday, as the broader European equity market declined. Yields on 10-year Spanish government bonds added 5 basis to 5.71%, the highest level since December last year.

Spanish 10-year yield rises 8 basis points and rise to the highest level since December on Thursday, as the effects from the European Central Bank’s cheap lending program start to wear off.

The Bank of England, as widely expected, left its key lending rate unchanged and made no alterations to its 325 billion pound ($516.8) program of asset purchases. The central bank’s key lending rate has stood at a record low 0.5% since March 2009.

Office for National Statistics said manufacturing production fell by 1% in February, slipping below analysts’ expectations of a 0.1% increase.

The Society of Motor Manufacturers and Traders, or SMMT, said Thursday the March new car market beat expectations with a 1.8% rise to 372,835 units, making a a rise of 0.9% over the first quarter.

 Economic Events April 5, 2012 actual v. forecast

 

 

Economic Events scheduled for April 6, 2012 that affect the European and American Markets

13:30     USD      Average Hourly Earnings (MoM)

13:30     USD      Private Nonfarm Payrolls

Average Hourly Earnings measures the change in the price businesses pay for labor, not including the agricultural sector.  Private Nonfarm Payrolls measures the change in the number of total number of paid U.S. workers of any business, excluding general government employees, private household employees, employees of nonprofit organizations that provide assistance to individuals and farm employees.                                   

13:30     USD      Nonfarm Payrolls

13:30     USD      Unemployment Rate

Nonfarm Payrolls measures the change in the number of people employed during the previous month, excluding the farming industry. Job creation is the foremost indicator of consumer spending, which accounts for the majority of economic activity. The Unemployment Rate measures the percentage of the total work force that is unemployed and actively seeking employment during the previous month.                                                                                                           

Government Bond Auctions

None scheduled until after April 10, 2012 due to holiday schedule

 

eig6