GBP/USD Fundamental Analysis October 3, 2014 Forecast

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Updated: Aug 24, 2015, 22:00 UTC

Analysis and Recommendations: The GBP/USD eased by 4 points against a weak US dollar. UK construction printed better than forecast but the GDP had little

GBP/USD Fundamental Analysis October 3, 2014 Forecast

Analysis and Recommendations:

The GBP/USD eased by 4 points against a weak US dollar. UK construction printed better than forecast but the GDP had little reaction ahead of the ECB meeting today. The construction industry continues to be a leading sector for the UK’s economic recovery, with a key reading on output hitting an eight-month high in September.

The Markit/CIPS Construction Purchasing Managers’ Index (PMI) gave a reading of 64.2, up from 64.0 in August and economist expectations of 63.5 as compiled by Reuters.

Strong output growth was maintained across the UK construction sector in September, supported by sharp rises in housing, commercial and civil engineering activity. However, while the overall performance of the construction sector was close to its strongest since the summer of 2007, latest data indicated that new order growth and job creation both eased to their lowest for four months.

British interest rates will rise from record lows early next year as the UK economic recovery outpaces Europe’s and inflation picks up, a Reuters poll of economists’ forecasts on Wednesday.

Although Bank of England Governor Mark Carney recently said a hike is getting nearer, only six of 60 economists polled this week expect it to happen this year, 48 forecast it in the first quarter of next year. Six see it coming later.

Recent strength in the British economy comes at the same time as a fall in inflation, which slowed to 1.5 percent in August — stubbornly below the Bank’s 2 percent target, but is expected to pick up in the coming months.

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
AUD	Building Approvals	3.0%	1.0%	2.1%
AUD	Trade Balance	-0.787B	-0.700B	-1.075B
EUR	Spanish Unemployment	19.7K	31.3K	8.1K
GBP	Construction PMI (Sep)	64.2	63.5	64.0
EUR	Interest Rate Decision		0.05%	0.05%
USD	Initial Jobless Claims		297K	293K
*EUR*	*ECB Press Conference*
USD	Factory Orders (MoM)		-9.3%	10.5%

Upcoming Economic Events that you should be monitoring:

Cur.	Event	Actual	Forecast	Previous
GBP	Services PMI (Sep)		59.1	60.5
USD	Nonfarm Payrolls (Sep)		215K	142K
USD	Unemployment Rate		6.1%	6.1%
USD	ISM Non-Mfg. PMI		58.5	59.6