Analysis and Recommendations: The EUR/GBP added 20 points as the pound continued to fall. The pair is trading at 0.7704. Sterling was lower against the
The EUR/GBP added 20 points as the pound continued to fall. The pair is trading at 0.7704. Sterling was lower against the euro. The single currency, often preferred during times of financial market stress, was up 0.4 percent not far from a one-year high of 77.56 pence struck on Jan. 20.
“We suspect the combination of a June Brexit vote and a shaky risk environment due to emerging market growth concerns will unambiguously weigh on sterling,” said Viraj Patel, currency strategist at ING.
“We retain our forecast for sterling/dollar to move below $1.40 in the second quarter of 2016.”
In its Quarterly Inflation Report released on Thursday, the BoE cut its economic growth forecasts due to a gloomier global outlook. The minutes from the BoE’s latest policy meeting also showed the lone advocate of a rate hike reversed his position this month.
And while the pound initially fell after the minutes and the Inflation Report were released, it recovered after Carney said that the next move by the BoE would be a rate hike and not a cut as some in the market were pricing in.
Nevertheless, traders expect the uncertainty stemming from the Brexit referendum would keep trading in the pound rather choppy in the coming months.
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.
Upcoming Economic Events that you should be monitoring:
Monday, February 8, 2016
Event | |||||||
Holiday | New Zealand – Waitangi (Observed) | ||||||
Holiday | China – Lunar New Year |
Government Bond Auctions
Date Time and Country
Feb 08 16:20 Italy Details of bond auction
Feb 09 11:00 Netherlands Holds DSL auction
Feb 09 11:00 Austria Holds bond auction
Feb 09 11:30 Germany Holds I/L bond auction
Feb 09 11:30 UK 0.125% 2026 Gilt linker auction
Feb 09 n/a UK Details of Gilt auction on Feb 17
Feb 09 19:00 US Holds 3-year note auction
Feb 10 11:30 Germany Euro 5bn Mar 2018 Schatz
Feb 10 17:20 Sweden Details of bond auction on Feb 17
Feb 10 19:00 US Holds 10-year note auction
Feb 11 N/A Italy Euro 4-5bn 30-yr syndicated bond auction
Feb 11 11:03 Sweden Holds I/L bond auction
Feb 11 11:10 Italy Announces details of bond auction
Feb 11 11:30 UK 3.5% 2045 Gilt auction
Feb 11 19:00 US Holds 30-year bond auction
Feb 11 n/a US Details of 30-yr TIPS auction on Feb 18
Feb 12 11:10 France Details of bond auction on 18 Feb