EUR/GBP Fundamental Analysis November 3, 2014 Forecast

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Updated: Aug 25, 2015, 07:00 UTC

Analysis and Recommendations: The EUR/GBP fell by 24 points to reach 0.7858 as the euro lost all support after German retail sales printed below forecast.

EUR/GBP Fundamental Analysis November 3, 2014 Forecast

Analysis and Recommendations:

The EUR/GBP fell by 24 points to reach 0.7858 as the euro lost all support after German retail sales printed below forecast. ECB policy makers have embarked on a series of unprecedented stimulus measures since June to stave off deflation and rekindle growth, and committed to add stimulus if needed. The economy has shown some signs of reaction, with business confidence unexpectedly improving and factory and services activity picking up. Economists forecast growth of 0.2 percent in the third and fourth quarters.

Inflation hasn’t met the ECB goal of just below 2 percent since early 2013. While President Mario Draghi has said that the risk of outright deflation in the region is remote, he predicts price gains will “remain low over the coming months before increasing gradually during 2015 and 2016.”

Sterling hit a fresh two-week high against the euro on Friday, ahead of crucial euro zone inflation data which could put more pressure on the European Central Bank to ease policy further. The pound has held up very very well compared with some of the other developed currencies, and that suggests to me that markets are starting to reassess the Bank of England pricing,

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.

Today’s economic releases actual vs. forecast:

Cur.	Event	Actual	Forecast	Previous
JPY	Household Spending	1.5%	1.9%	-0.3%
JPY	National Core CPI (Sep)	3.0%	3.0%	3.1%
JPY	Tokyo Core CPI (Oct)	2.5%	2.5%	2.6%
AUD	PPI (QoQ) (Q3)	0.2%	0.2%	-0.1%
EUR	German Retail Sales	-3.2%	-1.0%	1.5%
JPY	BoJ Press Conference
EUR	French Consumer	-0.8%	-0.3%	0.9%
EUR	Italian CPI (MoM)	0.1%	-0.2%	-0.4%
EUR	CPI (YoY) (Oct)	0.4%	0.4%	0.3%
EUR	Unemployment Rate	11.5%	11.5%	11.5%
USD	Core PCE Price Index		0.1%	0.1%
CAD	GDP (MoM) (Aug)		0.0%	0.0%
USD	Chicago PMI (Oct)		60.0	60.5
USD	UM Consumer Sent		86.4	86.4

Upcoming Economic Events that you should be monitoring:

Cur.	Event	Actual	Forecast	Previous
AUD	AIG Manufacturing			46.5
AUD	Building Approvals			3.0%
CNY	Non-Manufacturing PMI			54.0
CNY	HSBC Mfg. PMI			50.4
EUR	Spanish Manufacturing			52.6
EUR	Italian Manufacturing		50.7	50.7
EUR	French Manufacturing		47.3	47.3
EUR	German Manufacturing		51.8	51.8
EUR	Manufacturing PMI		50.7	50.7
GBP	Manufacturing PMI			51.6
USD	ISM Employment		55.0	54.6
USD	ISM Manufacturing PMI		56.7	56.6