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Barry Norman
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EUR/USD Fundamental Analysis October 14, 2014 Forecast

Analysis and Recommendations:

The EUR/USD soared gaining 68 points to trade at 1.2694 with little data and little news most attention were on comments from and about the ECB.  The US dollar index ended the week lower, breaking a 12-week winning streak, after US policymakers expressed increasing concern about the pace of gains by the ‘greenback’. The index was 0.9% lower at 85.91 by the closing bell on Friday, after 12 consecutive weeks of gains, the longest such streak since the collapse of the Bretton Woods system in 1971, according to Bloomberg.

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Echoing the tone of the minutes of the 16-17 September meeting, Fed vice chairman Stanley Fischer said on Saturday at the International Monetary Fund’s (IMF) annual meetings in Washington: “If foreign growth is weaker than anticipated, the consequences for the US economy could lead the Fed to remove accommodation more slowly than otherwise.”

Highlighting the delicate economic situation of the Eurozone, the latest Italian industrial production figures for August came in below forecasts, with a rise of 0.3% versus July. That prompted Barclays Research to say that the Mediterranean country “will struggle” to exit from a triple-dip recession.

In Europe it’s very likely to see Euro continue to weaken against other currencies. The European Central Bank Governing Council Member Ewald Nowotny was quoted on Sunday saying “Due to the different tendencies in interest rate policies there is a great likelihood that this leads to a further depreciation of the euro,” he was quoted as saying in an interview on the sidelines of International Monetary Fund meetings.

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

 

 

Holiday

Japan – Health-Sports Day

 

 

Holiday

Canada – Thanksgiving Day

 

  CNY

 

Exports (YoY) (Sep)

15.3%

11.8%

9.4%

 

 

  CNY

 

Imports (YoY) (Sep)

7.0%

-2.7%

-2.4%

 

 

  CNY

 

Trade Balance (Sep)

31.00B

41.00B

49.83B

 

 

Upcoming Economic Events that you should be monitoring:

 

Cur.

Event

Actual

Forecast

Previous

 

  AUD

RBA Asst Gov. Debelle

 

 

 

 

 

  CNY

New Loans

 

750B

703B

 

 

  EUR

French CPI

 

-0.3%

0.4%

 

 

  EUR

French HICP

 

-0.3%

0.5%

 

 

  EUR

Spanish CPI

 

0.2%

0.2%

 

 

  GBP

CPI (MoM) (Sep)

 

0.2%

0.4%

 

 

  GBP

CPI (YoY) (Sep)

 

1.4%

1.5%

 

 

  GBP

PPI Input (MoM) (Sep)

 

-0.4%

-0.6%

 

 

  EUR

Italian CPI (MoM) (Sep)

 

-0.3%

-0.3%

 

 

  EUR

Industrial Production

 

-1.6%

1.0%

 

Government Bond Auction

Date Time Country Auction

Oct 14 08:30 Spain 6 & 12M T-bill auction

Oct 14 09:30 Belgium 3 & 12M T-bill auction (Jan & Oct 2015)

Oct 15 09:03 Sweden Bond auction

Oct 15 09:30 Germany Eur 4.0bn Sep 2016 Schatz auction

Oct 16 08:30 Spain Bono/Obligacion auction

Oct 16 09:30 UK Auctions 0.125% 2024 I/L Gilt

Oct 16 15:00 US Announces details of 30Y TIPS auction on Oct 23

 

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