EUR/GBP Weekly Fundamental Analysis April 9-13, 2012, Forecast

By FXEmpire.com

Introduction: The cross tends to move in ranges, with relatively clear barriers. The narrower ranges made it somewhat harder, but it seems to return to wider ranges. The GBP is does not seem to move in response to the EUR as directly currently. The UK austerity program vs. The EU debt crisis seems to have them moving in opposing distances. They are developing new trading personalities and there is a good deal of profit to be made trading this pair. They can be volatile.

• The interest rate differential between the European Bank(ECB) and the Bank of England(BoE)
• European and UK economic data
• Growth differentials between the Euro zone and UK

Analysis and Recommendations

The EUR/GBP ended the week at 0.8241.

The sterling had several strong reports over the past week but they were mixed with several negatives also, PMI and Service PMI and Housing were over forecast. The BoE maintained interest rates. It was just a mixed bag

Whereas the euro began to tumble mid week on continued worries about Spain and Italy, overshadowed the EU Finance Ministers approval of the new firewall limits.

Disappointing economic data flowed all week. Spain introduced a tough new budget, which incorporated all the austerity measures demanded by the EU, but in reality would be difficult or impossible to implement.

Greece continued in the headlines, as worried about the necessity of a 3^rd bailout became news.

Midweek, the US FOMC minutes were released throwing markets into turmoil. It was clear by the minutes that the FED has no plans of any additional monetary easing in any form. This made investors rethink values.

Date	Last	Open	High	Low	Change %
04/06/2012	0.8241	0.8252	0.8256	0.8237	-0.13%
04/05/2012	0.8252	0.8266	0.8280	0.8238	-0.17%
04/04/2012	0.8265	0.8314	0.8325	0.8262	-0.59%
04/03/2012	0.8314	0.8313	0.8358	0.8313	0.01%
04/02/2012	0.8312	0.8342	0.8349	0.8294	-0.36%
04/01/2012	0.8342	0.8338	0.8350	0.8336	0.05%

Economic Data from Europe for the week of April 2-6, 2012 actual v. forecast

Apr. 02	08:15	CHF	Retail Sales (YoY)	0.8%	3.2%	4.7%
08:30	CHF	SVME PMI	51.1	49.5	49.0
08:50	EUR	French Manufacturing PMI	46.7	47.6	47.6
08:55	EUR	German Manufacturing PMI	48.4	48.1	48.1
09:00	EUR	Manufacturing PMI	47.7	47.7	47.7
09:30	GBP	Manufacturing PMI	52.1	50.5	51.5
10:00	EUR	Unemployment Rate	10.8%	10.8%	10.7%
Apr. 03	10:00	EUR	GDP (QoQ)	-0.3%	-0.3%	-0.3%
Apr. 04	08:00	GBP	Halifax House Price Index (MoM)	2.2%	-0.3%	-0.4%
09:30	GBP	Services PMI	55.3	53.5	53.8
10:00	EUR	Retail Sales (MoM)	-0.1%	0.1%	1.1%
11:00	EUR	German Factory Orders (MoM)	0.3%	1.2%	-1.8%
12:45	EUR	Interest Rate Decision	1.00%	1.00%	1.00%
13:30	EUR	ECB Press Conference
Apr. 05	08:15	CHF	CPI (MoM)	0.6%	0.4%	0.3%
08:30	EUR	Dutch CPI (YoY)	2.50%	2.20%	2.50%
09:30	GBP	Industrial Production (MoM)	0.4%	0.3%	-0.6%
09:30	GBP	Manufacturing Production (MoM)	-1.0%	0.1%	-0.3%
12:00	GBP	Interest Rate Decision	0.50%	0.50%	0.50%
12:00	GBP	BOE QE Total	325B	325B	325B
15:00	GBP	NIESR GDP Estimate	0.1%	0.0%

Historical:

Highest: 1.2336 EUR on 29 Jun 2010.

Average: 1.1548 EUR over this period.

Lowest: 1.0686 EUR on 13 Oct 2009

Economic Events:

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

Apr. 10	00:01	GBP	RICS House Price Balance	-13%
06:45	CHF	Unemployment Rate	3.1%
Apr. 12	06:30	EUR	French CPI (MoM)	0.4%
08:30	EUR	Dutch Retail Sales (YoY)	0.80%
09:30	GBP	Trade Balance	-7.5B
10:00	EUR	Industrial Production (MoM)	0.2%
10:00	EUR	Portuguese CPI (MoM)	0.10%
10:00	EUR	Greek Unemployment Rate	21.00%
Apr. 13	07:00	EUR	German CPI (MoM)	0.3%
07:00	EUR	Finnish CPI (YoY)	3.10%
09:30	GBP	PPI Input (MoM)	2.1%

Originally posted here