GBP/USD Weekly Fundamental Analysis December 3 – 7, 2012, Forecast

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Updated: Aug 20, 2015, 23:00 GMT+00:00

Introduction: While the ranges are wider (and so should stops be), the lines are rather distinctive, especially towards the borders of the long term wide

GBP/USD Weekly Fundamental Analysis December 3 - 7, 2012, Forecast

Introduction: While the ranges are wider (and so should stops be), the lines are rather distinctive, especially towards the borders of the long term wide range. This pair makes for good trades, with the new austerity program implemented in the UK, the GBP is moving more on Fundamentals now.

The interest rate differential between the Bank of England(BoE) and the Federal Reserve
High yield and attractive growth in the UK drives GBP/USD higher

Weekly Analysis and Recommendation:

The GBP/USD traded within a tight range this week holding just at the 1.60 range ending the week at 1.6010. Q3 GDP met expectations at 1% surprising traders who thought it would print below. The UK economy remains suspect as most data seems mixed to negative. Traders are looking forward to the Bank of England meeting this week, hoping for additional monetary easing but not expecting any.

Date	Last	Open	High	Low	Change %
Nov 30, 2012	1.6010	1.6037	1.6062	1.5990	-0.17%
Nov 29, 2012	1.6038	1.6014	1.6049	1.6002	0.15%
Nov 28, 2012	1.6014	1.6020	1.6022	1.5962	-0.03%
Nov 27, 2012	1.6019	1.6033	1.6056	1.6010	-0.09%
Nov 26, 2012	1.6033	1.6030	1.6035	1.5997	0.02%

This week’s big news was the announcement of the replacement for Governor King, with George Osborne appointing the Directorship to the Bank of England to Canada’s Carney, in a smart move that markets applauded.

There is a wave of UK data including trade, industrial production, a manufacturing PMI survey, and the NIESR’s November GDP estimate due this week.

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 recent analysis and information in our weekly reports and we provide daily updates and outlooks.

Major Economic Events for the week of November 26 – 30 actual v. forecast for Euro, GPB, the Franc, and USD

Date	Currency	Event	Actual	Forecast	Previous
Nov. 26	CHF	Employment Level	4.12M	4.09M	4.07M
	EUR	GfK German Consumer Climate	5.9	6.2	6.1
Nov. 27	GBP	Business Investment (QoQ)	3.7%	1.3%	0.9%
	GBP	GDP (QoQ)	1.0%	1.0%	1.0%
	GBP	GDP (YoY)	-0.1%	0.0%	0.0%
	USD	Core Durable Goods Orders (MoM)	1.5%	-0.5%	1.7%
	USD	Durable Goods Orders (MoM)	0.0%	-0.6%	9.2%
	USD	CB Consumer Confidence	73.7	73.0	73.1
Nov. 28	EUR	German CPI (MoM)	-0.1%	-0.1%	0.0%
	EUR	German CPI (YoY)	1.9%	1.9%	2.0%
	USD	New Home Sales	368K	390K	369K
Nov. 29	CHF	GDP (QoQ)	0.6%	0.2%	-0.1%
	GBP	Nationwide HPI (MoM)	0.0%	0.1%	0.6%
	EUR	German Unemployment Change	5K	15K	19K
	EUR	Italian 10-Year BTP Auction	4.45%		4.92%
	GBP	CBI Distributive Trades Survey	33	18	30
	USD	Initial Jobless Claims	393K	390K	416K
	USD	GDP (QoQ)	2.7%	2.8%	2.0%
	USD	Continuing Jobless Claims	3287K	3323K	3357K
	USD	Pending Home Sales (MoM)	5.2%	0.8%	0.4%
Nov. 30	EUR	French Consumer Spending (MoM)	-0.2%	-0.1%	0.1%
	CHF	KOF Leading Indicators	1.50	1.60	1.64
	EUR	CPI (YoY)	2.2%	2.4%	2.5%
	USD	Core PCE Price Index (MoM)	0.1%	0.2%	0.1%
	USD	Personal Spending (MoM)	-0.2%	0.2%	0.8%

Historical: From 2010 to Present

Highest: 1.6747 USD on April 28, 2011.

Average: 1.5751 USD over this period

Lowest: 1.4229 USD on May 20, 2010

Economic Highlights of the coming week that affect the Euro, GBP, CHF and the USD

Date	Time	Currency	Event	Forecast	Previous
Dec. 03	08:15	CHF	Retail Sales (YoY)	4.1%	5.4%
	08:30	CHF	SVME PMI	47.0	46.1
	15:00	USD	ISM Manufacturing Index	51.3	51.7
Dec. 05	10:00	EUR	Retail Sales (MoM)	-0.1%	-0.2%
	13:15	USD	ADP Nonfarm Employment Change	125K	158K
	13:30	USD	Nonfarm Productivity (QoQ)	2.7%	1.9%
	13:30	USD	Unit Labor Costs (QoQ)	-0.9%	-0.1%
	15:00	USD	ISM Non-Manufacturing Index	53.5	54.2
Dec. 06	08:15	CHF	CPI (MoM)		0.1%
	09:30	GBP	Trade Balance	-8.8B	-8.4B
	10:00	EUR	GDP (QoQ)	-0.1%	-0.1%
	11:00	EUR	German Factory Orders (MoM)	0.9%	-3.3%
	12:00	GBP	Interest Rate Decision	0.50%	0.50%
	12:00	GBP	BOE QE Total	375B	375B
	12:45	EUR	Interest Rate Decision	0.75%	0.75%
Dec. 07	09:30	GBP	Industrial Production (MoM)	0.7%	-1.7%
	09:30	GBP	Manufacturing Production (MoM)	-0.2%	0.1%
	09:30	GBP	Industrial Production (YoY)	-0.6%	-2.6%
	11:00	EUR	German Industrial Production (MoM)	-0.5%	-1.8%