EUR/GBP Fundamental Analysis – December 8, 2015 -Forecast

Analysis and Recommendations:

The EUR/GBP dipped 17 points to trade at 0.7177 as the euro weakened with Mr. Draghi pushing more stimuli when needed into the markets. The US dollar continued to recover as markets adjusted to last week’s turmoil. Sterling shed nearly 1.7 percent against a rallying euro on Thursday after the European Central Bank’s monetary easing measures fell short of market expectations, prompting speculators to trim hefty bets against the single currency.

The ECB extended its asset-purchase program, known as quantitative easing, by six months to March 2017, but did not beef up monthly purchases as many had hoped. It also agreed to buy euro-denominated municipal and regional bonds and cut its deposit rates by 10 basis points to -0.30 percent, although this was less than money markets had priced in.

Any concerns BoE officials may have had over the strength of the pound, chiefly against the euro, may have been eased by Thursday’s surge in the single currency. If the euro’s run lower against the dollar, as a number of banks have begun to argue, is close to an end, then that should signal more stability against the pound as well, traders said.

“The markets were extremely disappointed with the outcome from the ECB, with the euro rallying strongly. The poor performance from the ECB has put an end to the euro/dollar parity question this year,” said Craig Erlam, senior market analyst at Oanda.

FxEmpire provides in-depth analysis for each asset 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, which covers the current week and are published by Sunday before the new week begins. Daily we share any new events, forecasts or analysis that affect the current day. To achieve a full accurate understanding it is important that you study all of our data and analysis as a whole.

Today’s economic releases:

 

Upcoming Economic Events that you should be monitoring:

Tuesday, December 8, 2015

Government Bond Auctions

Date Time Country

Dec 07 13:00 Norway Details bond auction on 09 Dec

Dec 07 17:30 Italy Announces details of BTP/CCTeu on 11 Dec

Dec 08 11:30 UK 3.5% 2045 Gilt auction

Dec 08 19:00 US Holds 3-year note auction

Dec 09 11:03 Sweden Holds bond auction

Dec 09 11:05 Norway Holds bond auction

Dec 09 11:30 Germany Eur 3bn Dec 2017 Schatz

Dec 09 19:00 US Holds 10-year note auction

Dec 10 19:00 US Holds 30-year bond auction

Dec 11 11:10 Italy Auctions BTPs/CCTeus