EUR/USD Fundamental Analysis December 11, 2012, Forecast

Analysis and Recommendations:

The EUR/USD plunged earlier in the morning as traders dealt with the shocking news that Italian Prime Minister was stepping down and that Silvio Berlusconi was returning to politics. The euro fell over 36pts at the opening and has been weak all day. It now trades at 1.2932 after reversing course and adding 5pts. There was no supportive data for the euro today, except positive Chinese data, the pair is most likely adjusting ahead of this week’s 2day meeting of the Federal Reserve. The FOMC is expected to add additional stimulus and extend Operation Twist, which will weaken the US dollar and strengthen gold, which is what markets are witnessing at present.

News that Italy is likely to enter an early election once the 2013 budget is passed on December 18 has increased political uncertainty, but has had a more material impact on bond markets, with 10-year Italian yields up 37bpts to 4.88%. Meanwhile Greek 10-years are down 30bpts to 13.56% as the country extends its buyback deadline from Friday at 5pm to Tuesday at noon GMT. However most reports are that participation is strong. Fundamental data was mixed with strong German exports rising 0.3%m/m and imports up 2.5%m/m offset by weak French and Italian industrial and manufacturing production.

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

Economic Data December 9, 2012 actual v. forecast

Economic Data December 10, 2012 actual v. forecast

 

Upcoming Economic Events that affect the CHF, EUR, GBP and USD

Government Bond Auction

Date Time Country 

Dec 11 09:30 Spain 

Dec 11 10:10 Greece 

Dec 11 10:15 Austria 

Dec 11 10:30 Belgium 

Dec 11 10:30 UK 

Dec 11 18:00 US 

Dec 12 10:10 Italy  

Dec 12 10:10 Sweden 

Dec 12 10:30 Swiss 

Dec 12 16:30 US 

Dec 13 01:30 Japan 

Dec 13 09:30 Spain 

Dec 13 10:10 Italy  

Dec 13 10:30 UK 

Dec 13 16:00 US 

Dec 13 18:00 US 

Dec 14 11:00 Belgium 

Dec 14 15:30 UK