EUR/GBP Fundamental Analysis October 3, 2014 Forecast

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Updated: Aug 24, 2015, 22:00 UTC

Analysis and Recommendations: The EUR/GBP gained 13 points as traders wait for the all-important ECB decision and Mr. Draghi’s press conference. Many

EUR/GBP Fundamental Analysis October 3, 2014 Forecast

Analysis and Recommendations:

The EUR/GBP gained 13 points as traders wait for the all-important ECB decision and Mr. Draghi’s press conference. Many traders now think Mr. Draghi will bypass additional stimulus on the hopes that he can maneuver the markets with words again. The pair climbed to trade at 0.7813. n the euro zone, Britain’s biggest trading partner, inflation is at a five-year low of just 0.3 percent and the bloc’s economy stagnated in the second quarter.

Dwindling demand from the euro zone has hurt British factories, with the latest data showing UK manufacturing grew at the slowest rate in 17 months in September.

Even after a “no” vote at the Scottish independence referendum last month, expectations on the timing of a rate hike were unchanged from previous polls. Indeed, 14 of 25 economists who answered an extra question in the survey said that vote did not increase the probability of an earlier rate hike, while 11 said it did.

The Scottish referendum on independence and political fallout over a very close vote has hurt the pound, with the currency falling more than 5 percent against the dollar since July, wiping off gains made in the first half of the year.

This week’s Conservative Party conference has so far served only to highlight political risks to sterling ahead of next May’s parliamentary elections.

Sterling hit a two-week low against the dollar on Tuesday but firmed to a more than two-year high against the euro, the latest leg of a broad-based rally in the U.S. currency that dates back almost three months.

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
AUD	Building Approvals	3.0%	1.0%	2.1%
AUD	Trade Balance	-0.787B	-0.700B	-1.075B
EUR	Spanish Unemployment	19.7K	31.3K	8.1K
GBP	Construction PMI (Sep)	64.2	63.5	64.0
EUR	Interest Rate Decision		0.05%	0.05%
USD	Initial Jobless Claims		297K	293K
*EUR*	*ECB Press Conference*
USD	Factory Orders (MoM)		-9.3%	10.5%

Upcoming Economic Events that you should be monitoring:

Cur.	Event	Actual	Forecast	Previous
GBP	Services PMI (Sep)		59.1	60.5
USD	Nonfarm Payrolls (Sep)		215K	142K
USD	Unemployment Rate		6.1%	6.1%
USD	ISM Non-Mfg. PMI		58.5	59.6