GBP/USD Fundamental Analysis – August 6, 2015 – Forecast

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Published: Aug 5, 2015, 15:09 UTC

Analysis and Recommendations: The GBP/USD added 19 points after Services PMI missed expectations as traders prepare for Super Thursday and the new program

GBP/USD Fundamental Analysis – August 6, 2015 – Forecast

Analysis and Recommendations:

The GBP/USD added 19 points after Services PMI missed expectations as traders prepare for Super Thursday and the new program from the Bank of England. Sterling has been underpinned in recent weeks by mostly robust data out of Britain, with consumer demand holding up well and the pace of growth accelerating in the second quarter. Bank of England Governor Mark Carney has indicated a decision on rates will come around the turn of the year.

All eyes are on Thursday when the Bank of England will release its quarterly inflation report, its rate decision and the minutes of the policy meeting where the first split in the nine-member committee is expected. Investors expect three members to vote for a rate hike.

“The market is tilted toward a hawkish BOE on Thursday. So if the BoE falls short, we could see sterling drop. There is a good degree of two-way risk going into Thursday,” said John Hardy, FX strategist, at Saxo Bank.

Traders have been weighing the timing as to when the Bank of England will raise interest rates. Clouding the picture has been a mixed bag of data. Two weeks ago, we had negative UK retail sales numbers. That data was then offset with an overall positive GDP report.

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
CNY	Caixin Services PMI (Jul)		53.8	52.2	51.8
RUB	Markit Services PMI (Jul)		51.6	49.2	49.5
CHF	CPI (MoM) (Jul)		-0.6%	-0.4%	0.1%
EUR	Spanish Services PMI (Jul)		59.7	55.5	56.1
EUR	German Services PMI (Jul)		53.8	53.7	53.7
EUR	Markit Composite PMI (Jul)		53.9	53.7	53.7
EUR	Services PMI (Jul)		54.0	53.8	53.8
GBP	Services PMI (Jul)		57.4	58.0	58.5
EUR	Retail Sales (MoM) (Jun)		-0.6%	-0.3%	0.1%

Upcoming Economic Events that you should be monitoring:

Thursday, August 6, 2015

Cur.	Event	Actual	Forecast	Previous
AUD	Employment Change (Jul)		15.0K	7.3K
GBP	Manufacturing Production (Jun)		0.2%	-0.6%
GBP	BoE Inflation Report
GBP	Interest Rate Decision (Aug)		0.50%	0.50%
GBP	BoE MPC Meeting Minutes
GBP	BoE Gov Carney Speaks