GBP/USD Weekly Fundamental Analysis, October 27-31, 2014, Forecast

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Updated: Aug 25, 2015, 03:00 UTC

Weekly Analysis and Recommendation: The GBP/USD gained steadily on Friday to recover much of the week’s losses adding 53 points to close out at 1.6083

GBP/USD Weekly Fundamental Analysis, October 27-31, 2014, Forecast

Weekly Analysis and Recommendation:

The GBP/USD gained steadily on Friday to recover much of the week’s losses adding 53 points to close out at 1.6083 after UK GDP met expectations but a poor retail sales report on Thursday continued to weigh on the pound. The UK economy grew at a slower pace in the third quarter, preliminary estimates from the Office for National Statistics Office showed. Gross domestic product climbed 0.7% from the second quarter, when it grew 0.9%.

That put annual growth at 3.0 percent, also down slightly but among the fastest rates in the developed world, prompting British finance minister George Osborne to tweet: “The UK is leading the pack in an increasingly uncertain global economy.”

Sterling money markets continued to price a first interest rate rise by the Bank of England around the middle of next year, potentially the first post-crisis hike by any big central bank.

There are several reasons why British growth might continue to slow into the end of the year, including the recent burst of financial market volatility and growing signs of renewed stagnation in the euro zone.

A persistently wide current account deficit, deteriorating public finances and weak wage growth that dampens consumer spending are also factors.

Earlier this week, BoE chief economist Andy Haldane said he was “gloomier” on the economy, implying that interest rates could remain “lower for longer”.

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.

Historical: From 2011 to Present

Highest: 1.6618 USD on Aug 19, 2011

Average: 1.5764 USD over this period

Lowest: 1.4832 USD on Mar 12, 2013

Major Economic Events for the week of October 27-31st

Time	Cur.	Imp.	Event	Actual	Forecast	Previous
Monday, October 27
		Holiday	New Zealand – Labour Day
	EUR		German Ifo Business Climate Index (Oct)		104.3	104.7
	USD		Pending Home Sales (MoM) (Sep)		0.5%	-1.0%
Tuesday, October 28
	USD		Core Durable Goods Orders (MoM) (Sep)		0.5%	0.4%
	USD		CB Consumer Confidence (Oct)		87.0	86.0
Wednesday, October 29
	NZD		Interest Rate Decision		3.50%	3.50%
Thursday, October 30
	EUR		German Unemployment Change (Oct)		5K	13K
	USD		GDP (QoQ) (Q3)		3.0%	4.6%
Friday, October 31
	EUR		CPI (YoY) (Oct)		0.4%	0.3%
	CAD		GDP (MoM) (Aug)