By FXEmpire.com

Analysis and Recommendations:

The EUR/GBP is holding at 0.8151. EUR/GBP basically held a sideways trading pattern roughly between 0.8145 and 0.8205. The pair was changing hands in the middle of that range at the start of trading in Europe. A decent German IFO report pushed EUR/GBP for a test of the 0.82 big figures. Mid morning, the UK retail sales came out much stronger than expected. There were exceptional factors, but the report was strong overall. EUR/GBP reversed the post-IFO gains, but a real test of Thursday’s low didn’t occur. Later in the session, the euro found a better bid overall and EUR/GBP joined this move. The pair revised the 0.8200 area after the close of the European markets, but failed to sustain above that level. EUR/GBP closed the week at 0.8197, compared to 0.8184 on Thursday.

Later this week, markets will look out for the first estimate of the Q1 UK GDP. Will the UK avoid a technical recession (two consecutive negative quarters). This is somewhat of a symbolic issue, but a reasonably good figure will confirm the assessment in the market that the BoE will not raise the amount of asset purchases at the May meeting. After the Minutes of the Previous BoE meeting and decent eco data of late, an ‘on hold’ status of the BoE shouldn’t be a surprise for markets anymore. So, the rally of sterling against the euro might slow going into the BoE meeting.

The euro was pressured throughout the day with just a lot of negative problems in the eurozone, beginning with French elections and the announcement that Dutch Prime Minister Mark Rutte will tender his resignation to Queen Beatrix on Monday, setting the stage for elections, after the weekend collapse of budget talks, news reports said.

Business activity across the 17-nation euro zone contracted at a faster-than-expected pace in April, according to the preliminary purchasing managers’ index, or PMI, readings released Monday by data firm Markit. Manufacturing PMI fell to 46.0

French, Dutch, Spanish and Italian government bonds fell Monday, pushing up yields, while German government bonds rallied on safe-haven

Economic Data for April 23, 2012 actual v. forecast

AUD

PPI (QoQ)

-0.3%

0.4%

0.3%

CNY

Chinese HSBC Manufacturing PMI

49.10

48.30

EUR

French Business Survey

95

96

98

EUR

French Manufacturing PMI

47.3

47.2

46.7

EUR

French Services PMI

46.4

50.2

50.1

EUR

German Manufacturing PMI

46.3

49.0

48.4

EUR

German Services PMI

52.6

52.3

52.1

EUR

Manufacturing PMI

46.0

48.2

47.7

EUR

Services PMI

47.9

49.4

49.2

EUR

Italian Consumer Confidence

89.0

96.5

96.3

TWD

Taiwanese Industrial Production (YoY)

-3.4%

-6.8%

8.4%

EUR

German 12-Month Bubill Auction

0.074%

0.077%

CAD

Wholesale Sales (MoM)

1.6%

-1.0%

-1.1%

EUR

French 3-Month BTF Auction

0.090%

0.084%

EUR

French 6-Month BTF Auction

0.121%

0.119%

EUR

French 12-Month BTF Auction

0.250%

0.249%

MXN

Mexican Retail Sales (YoY)

7.6%

5.0%

4.4%

Economic Events scheduled for April 24, 2012 that affect the European and American Markets

07:00 EUR Finnish Unemployment Rate 7.40%

The unemployment rate represents the number of unemployed persons expressed as a percentage of the labor force. The unemployment rate for a particular age/sex group is the number of unemployed in that group expressed as a percentage of the labor force for that group.

10:00 EUR Industrial New Orders (MoM) -0.5% -2.3%

Industrial New Orders measures the change in the total value of new purchase orders placed with manufacturers. It is a leading indicator of production. A higher than expected reading should be taken as positive/bullish for the EUR, while a lower than expected reading should be taken as negative/bearish for the EUR.

15:00 USD CB Consumer Confidence 70.3 70.8

Conference Board (CB) Consumer Confidence measures the level of consumer confidence in economic activity. It is a leading indicator as it can predict consumer spending, which plays a major role in overall economic activity. Higher readings point to higher consumer optimism.

15:00 USD New Home Sales 320K 313K

New Home Sales measures the annualized number of new single-family homes that were sold during the previous month. This report tends to have more impact when it’s released ahead of Existing Home Sales because the reports are tightly correlated

Government Bond Auctions (this week)

Apr 24 00:30 Japan Auctions 20Y JGBs

Apr 24 08:30 Holland Eur 1.5-2.5bn Jul 2014 & Jan 2037 DSL auction

Apr 24 08:30 Spain 3 & 6M T-bill auction

Apr 24 09:10 Italy Auctions CTZ/BTPei

Apr 24 14:30 UK Details Conventional Gilt auction on May 01 & I/L auction on May 03

Apr 24 17:00 US Auctions 2Y Notes

Apr 25 09:10 Sweden Auctions T-bills

Apr 25 09:30 Germany Eur 3.0bn new Jul 2044 Bund

Apr 25 14:30 Sweden Details nominal bond auction on May 02

Apr 25 17:00 US Auctions 5Y Notes

Apr 26 00:30 Japan Auctions 2Y JGBs

Apr 26 09:10 Italy BOT auction

Apr 26 14:30 Sweden Details I/L bond auction on May 03

Apr 26 17:00 US Auctions 7Y Notes

Apr 27 09:10 Italy BTP/CCTeu auction

Click here for updated EUR/GBP News.

Originally posted here