Economic Events: (GMT)
09:00 EUR German Ifo Business Climate Index 107.5 107.2
09:00 EUR German Current Assessment 116.8 116.7
09:00 EUR German Business Expectations 99.0 98.4
The German Ifo Business Climate Index rates the current German business climate and measures expectations for the next six months. It is a composite index based on a survey of manufacturers, builders, wholesalers and retailers. The index is compiled by the Ifo Institute for Economic Research.
The German Current Assessment rates current business conditions in Germany, without considering future expectations. It is a sub-index of the German Ifo Business Climate Index.
German Business Expectations rates the expectations of businesses in Germany for the following six months. It is is a sub-index of the German Ifo Business Climate Index.
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.
13:15 EUR ECB President Draghi Speaks **** the event of the day****this can move markets
European Central Bank (ECB) President Mario Draghi (November 2011 – November 2019) is to speak. As head of the ECB, which sets short term interest rates, he has a major influence over the value of the euro. Traders watch his speeches closely as they are often used to drop subtle hints regarding future monetary policy and interest rate shifts.
09:30 GBP BBA Mortgage Approvals 35.3K 34.7K
The British Bankers’ Association (BBA) Mortgage Approvals measures the number of new mortgages approved by BBA-backed banks during the previous month. It includes more than half of the total U.K. mortgage market. It provides information about the buyers in the housing market in the U.K.
A higher than expected reading should be taken as positive/bullish for the GBP, while a lower than expected reading should be taken as negative/bearish for the GBP.
09:30 GBP GDP (QoQ) -0.1% 0.6%
Gross Domestic Product (GDP) measures the annualized change in the inflation-adjusted value of all goods and services produced by the economy. It is the broadest measure of economic activity and the primary indicator of the economy’s health.
A higher than expected reading should be taken as positive/bullish for the GBP, while a lower than expected reading should be taken as negative/bearish for the GBP.
09:30 GBP MPC Meeting Minutes
The Monetary Policy Meeting Minutes are a detailed record of the Bank of England’s policy setting meeting, containing in-depth insights into the economic conditions that influenced the decision on where to set interest rates. The breakdown of the MPC members’ interest rate votes tends to be the most important part of the minutes.
11:00 GBP CBI Industrial Trends Orders -19 -23
The Confederation of British Industry (CBI) Industrial Trends Orders measures the economic expectations of the manufacturing executives in the U.K. It is a leading indicator of business conditions. A level above zero indicates order volume is expected to increase; a level below zero indicates expectations are for lower volumes. The reading is compiled from a survey of about 550 manufacturers.
A higher than expected reading should be taken as positive/bullish for the GBP, while a lower than expected reading should be taken as negative/bearish for the GBP.
EUR/GBP Fundamental Analysis Jan. 25, 2012, Forecast
Analysis and Recommendations:
The pair EUR/GBP is currently 0.8328 opening this morning at 0.8360. This pair is moving in similar patterns to the EUR/USD and all of the other related currencies. The markets are hinged on Greece.
The euro improved slightly before noon on multiple economic reports within the eurozone, none were significant but together they gave a push to the shared currency. The combination of the German, French and EU manufacturing reports all staying pretty close to forecast, were interpreted as good news. As the Spanish Trade balances were reported, investors became more wary of the problems with the Greece settlement.
The EU Ministers rejected the coupon or interest to be paid on the swapped bonds, even though a completed deal was not settled, everyone went back to the drawing board. At this time, investors are going to have to take such a big haircut and loss of future earning also, that a default might be in the works.
Standard and Poor’s chimed into today, saying that once the negotiated settlement was reached that they would place Greece on a “selective default”. Anyway you interpret this it is a default, the IIF is being forced into a corner and eventually will be forced into a settlement of some sort, when you force your creditors into a settlement, that is a default.
U.K. public sector net borrowing reported today showed less-than-expected rise in December, but total outstanding debt rose above GBP1 trillion for the first time on record.
As I said before, I think we will pretty much be in a tight range until some final decisions are made or forced. Wednesday, European Central Bank (ECB) President Mario Draghi is scheduled to speak, this will have definite effects on the markets, listen carefully to what is said and what is not said.
Upcoming Govt Bond Sales Dates
Jan 25 10:10 Sweden Nominal bond auction
Jan 25 10:30 Germany Eur 3.0bn 3.25% Jul 2042 Bund
Jan 25 16:30 Italy Details BTP/CCTeu on Jan 30
Jan 25 18:00 US Auctions 5Y Notes
Jan 26 10:10 Italy Auctions CTZ/BTPei
Jan 26 18:00 US Auctions 7Y Notes
Jan 27 10:10 Italy BOT auction
Originally posted here
