GBP/USD Fundamental Analysis – August 28, 2015 – Forecast

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Published: Aug 27, 2015, 14:16 UTC

Analysis and Recommendations: The GBP/USD was flat today at 1.5462 after the release of nationwide HPI which met expectations on an annual basis. The

GBP/USD Fundamental Analysis – August 28, 2015 – Forecast

Analysis and Recommendations:

The GBP/USD was flat today at 1.5462 after the release of nationwide HPI which met expectations on an annual basis. The dollar was a bit up today balancing the pounds moves. Sterling hovered near a three-week low against a rallying dollar on Thursday, with investors uncertain about when the Bank of England will raise interest rates, given the volatility in global stock markets.

With a semblance of calm returning to global financial markets, in part due to reassurances from influential Federal Reserve policymaker William Dudley that U.S. rates will stay lower for longer, sterling was outperforming low-yielding currencies like the euro and the safe-haven yen.

Money markets have pushed out the timing for a BoE hike to around the third quarter of next year compared with early 2016 when the central bank published its quarterly inflation report three weeks ago.

Fears of a global slowdown intensified since China devalued its currency and data pointed to further signs of weakness. These factors triggered sell-off in Chinese stocks and spilled over to global stock markets.

Focus was now turning to an annual conference in Jackson Hole, Wyoming, attended by many of the world’s top central bankers. BOE Governor Mark Carney is a panelist at the symposium on Saturday where global inflation dynamics will be discussed.

Earlier this month Carney indicated a decision to raise rates could come at the turn of the year, but investors will be keen to hear the BoE’s take on recent events and whether it changes the monetary policy outlook for the near term.

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:

Cur.	Event	Actual	Forecast	Previous
AUD	Private New Capital Expenditure	-4.0%	-2.5%	-4.7%
GBP	Nationwide HPI (MoM) (Aug)	0.3%	0.4%	0.4%
GBP	Nationwide HPI (YoY) (Aug)	3.2%	3.1%	3.5%
EUR	Spanish GDP (QoQ) (Q2)	1.0%	1.0%	1.0%
RUB	Central Bank reserves (USD)			362.9B

Upcoming Economic Events that you should be monitoring:

Friday, August 28 2015

Cur.	Event	Actual	Forecast	Previous
JPY	Household Spending (YoY) (Jul)		1.3%	-2.0%
JPY	Household Spending (MoM) (Jul)		2.2%	-3.0%
JPY	National Core CPI (YoY) (Jul)		-0.2%	0.1%
JPY	Tokyo Core CPI (YoY) (Aug)		-0.2%	-0.1%
JPY	Retail Sales (YoY) (Jul)		1.1%	0.9%
CHF	GDP (YoY) (Q2)		0.9%	1.1%
CHF	GDP (QoQ) (Q2)		-0.1%	-0.2%
EUR	Spanish CPI (YoY) (Aug)		-0.1%	0.1%
EUR	Spanish HICP (YoY) (Aug)		-0.2%	0.0%
GBP	Business Investment (QoQ)		1.7%	2.0%
GBP	GDP (QoQ) (Q2)		0.7%	0.7%
EUR	German CPI (MoM) (Aug)		-0.1%	0.2%
USD	Core PCE Price Index (MoM) (Jul)		0.1%	0.1%
USD	Goods Trade Balance (Jul)			-62.26B
USD	Personal Spending (MoM) (Jul)		0.4%	0.2%
CAD	RMPI (MoM) (Jul)		-4.0%	0.0%
USD	Michigan Consumer Expectations			83.8