GBP/USD Fundamental Analysis December 18, 2012, Forecast

Analysis and Recommendations:

The GBP/USD continued to climb gathering momentum against the dollar to trade at 1.6205. There was little data outside of the Rightmove House Index which continued to decline. The US dollar remains weak with politicians try to come up with a deal. Sterling has raised 0.2% vs the USD, despite ongoing weakness in housing prices, as markets look to this week’s CPI data and BoE minutes release, both of which are likely to be supportive of GBP in terms of their impact on the outlook for monetary policy.

Sterling hit a two-and-a-half month high against the dollar, with traders saying it was lifted in thin trading by demand from Middle East investors and from companies looking to hedge.

Analysts said the pound could see further gains against the dollar if the so-called U.S. fiscal cliff, a looming combination of tax rises and spending cuts due to kick-in at the beginning of 2013, is not headed off soon.

Traders said demand from Middle East investors buoyed the pound in early trade. Later, demand from corporates also surfaced, while one trader reported Asian names buying.

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 17, 2012 actual v. forecast

 

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

Government Bond Auction

Date Time Country 

Dec 18 01:30 Japan 

Dec 18 09:30 Spain 

Dec 18 10:10 Greece 

Dec 18 18:00 US 

Dec 19 18:00 US 

Dec 20 10:30 UK 

Dec 20 16:30 Italy  

Dec 20 18:00 US 

Dec 21 16:30 Italy