GBP/USD Forecast Dec. 27, 2011, Fundamental Analysis

On Monday trading, the markets are closed due to the year-end holidays. For Tuesday, while the U.K. lacks fundamentals, the U.S., will release S&P/caseShiller for the month of Oct., due at 14:00 GMT, which is predicted to record -0.20% from the prior -0.50%, followed by consumer confidence, available at 15:00 GMT, where analysts forecasts a  soar to 58.5 in Dec. from 56.0 a month earlier.

Eyes will track the latest data from the U.S. to see the progress of the economy as last week’s data provided hopes the U.S. economy will lead the recovery path in 2012 without the need of further stimuli from the Fed.

Thus, the pair is expected to be affected by the data, yet it may also follow the general trend in the market which is focusing on the latest developments in the euro region.

In the U.K, the outlook remains clouded with uncertainty as King said last week debt crisis will threat the real economy recovery while the latest announcement by officials referred that the outlook for the British economy will largely depend on the latest developments in the euro zone.

Thus, in 2012, the situation in the U.S. seems to be much better than the U.K. along with the refuge merit of the dollar which suggest further advance for decline for the pound versus the greenback at least in the first half of the year.