EUR/GBP Fundamental Analysis October 22, 2014 Forecast

Analysis and Recommendations:

The EUR/GBP fell 28 points to trade at 0.7891 after comments from the ECB sent the euro tumbling. The euro dropped on Tuesday after reports said the European Central Bank may start buying corporate bonds on the secondary market. Citing people familiar with the matter, Reuters said the ECB could decide on the purchases as soon as in December, with the bond buying beginning as early as next year. A spokesperson from the ECB told MarketWatch that the Governing Council “has taken no such decision” in regards to start purchasing corporate bonds. The Reuters report comes a day after the ECB said it had started buying covered bonds as part of its most recent stimulus program to boost the eurozone economy.

“It increases the potential scale of the purchases the ECB will be able to make if they extend out into the corporate bond market,” said Lee Hardman, a strategist with Bank of Tokyo-Mitsubishi in London.

“That reinforces market confidence in (ECB chief) Mr. Draghi’s pledge to increase the bank’s balance sheet by a significant amount. The ECB is still under pressure to do more.”

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:

There was no European data today.

Upcoming Economic Events that you should be monitoring:

Government Bond Auction

Date Time Country Auction

Oct 21 10:30 Spain 3 & 9M T-bill auction

Oct 21 11:00 Finland Maximum Eur 1bn 2.75% Jul 2028 bonds

Oct 21 11:00 Norway Nok 3bn 3% Mar 2024 bonds

Oct 21 11:00 UK GBP 3bn 2.75% Sep 2024 Gilt

Oct 21 12:30 ESM Up to Eur 1bn 6M T-bills (Apr 2015)

Oct 22 11:30 Germany Eur 2.0bn 2.5% Aug 2046 Bund

Oct 23 11:03 Sweden Sek 1bn 0.5% Jun 2017 I/L bond

Oct 23 17:00 US Announces 2/5/7Y Note & 2Y FRN auctions on Oct 28/29/30

Oct 23 17:30 Italy Announces details of BTPei/CTZ auctions on Oct 28

Oct 23 19:00 US USD 7bn 30Y TIPS auction

Oct 24 17:30 Italy Announces details of BOT auction on Oct 29

Oct 27 12:30 Germany Eur 2.0bn new 12M Bubill (Oct 2015) auction

Oct 27 18:30 Italy Announces details of BTP/CCTeu auctions on Oct 30

Oct 27 12:10 Italy BTPei/CTZ auctions

Oct 28 12:10 Italy BOT auction

Oct 28 19:00 US 2Y Note auction

Oct 29 12:03 Sweden Bond auction

Oct 29 12:30 Germany Eur 4.0bn Aug 2024 Bund auction

Oct 29 17:30 US 2Y FRN auction

Oct 29 19:00 US 5Y Note auction

Oct 30 12:10 Italy BTP/CCTeu auctions

Oct 30 19:00 US 7Y Note auction