By FXEmpire.com
GBP/USD Fundamental Analysis April 2, 2012, Forecast
Analysis and Recommendations:
The GBP/USD is currently at 1.5993, markets had earlier forecast the pound the break the 1.60 level which it did in today’s trading session reaching a high of 1.6036, the pound surprised most traders bouncing back after a few negative reports earlier in the week.
There was no economic data out in the UK today and most US data was positive, ranging from consumer sentiment to consumer spending.
After EU Finance Ministers agreed to up the EMS and EFSF to close to a trillion euro value, investors were more confident and moved out of the USD.
Euro-zone finance ministers meeting in Copenhagen agreed to temporarily boost the size of the firewall designed to contain the spread of the region’s debt crisis to 800 billion euros ($1.1 trillion) from a previously planned 500 billion euros.
International Monetary Fund Managing Director Christine Lagarde on Friday said she welcomed the decision by euro-zone finance ministers to temporarily boost the effective lending capacity of the region’s bailout funds to 700 billion euros
Spanish government bond prices added to gains Thursday, pushing down yields, after Spain announced 27 billion euros ($36 billion) of austerity cuts in its 2012 budget.
With the EU debt crisis temporarily under control and more upbeat data in the US, where consumer sentiment in March reached the highest in more than a year, as consumers grew more confident about their current economic conditions.
The University of Michigan said the final reading for the consumer-sentiment gauge in March hit 76.2 — the highest since February 2011. Last month sentiment was at 75.3.
The Chicago PMI, or Chicago business barometer by its formal name, decelerated in March but marked its fifth straight month above 60%. The PMI fell to 62.2% in March from 64.0% in February,
Americans spent money in February at the fastest pace in seven months, but a good chunk of their cash went to pay for higher energy costs and incomes rose at a much slower clip, government data showed.
Personal spending jumped 0.8% in February as personal income edged up 0.2%, the Commerce Department said.
The Sterling will react on Monday after UK Manufacturing PMI is released.
Economic Reports March 30, 2012 actual v. forecast
|
JPY |
Unemployment Rate |
4.5% |
4.6% |
4.6% |
|
JPY |
Tokyo Core CPI (YoY) |
-0.3% |
-0.3% |
-0.3% |
|
JPY |
Industrial Production (MoM) |
1.9% |
1.4% |
1.9% |
|
AUD |
HIA New Home Sales (MoM) |
3.0% |
-7.3% |
|
|
EUR |
French Consumer Spending (MoM) |
3.0% |
0.2% |
-0.4% |
|
CHF |
KOF Leading Indicators |
0.08 |
0.08 |
-0.11 |
|
NOK |
Norwegian Retail Sales (MoM) |
1.00% |
-0.50% |
1.10% |
|
EUR |
CPI (YoY) |
2.6% |
2.5% |
2.7% |
|
EUR |
Greek Retail Sales (YoY) |
-10.30% |
-12.60% |
|
|
USD |
Core PCE Price Index (MoM) |
0.1% |
0.1% |
0.2% |
|
GDP (MoM) |
0.1% |
0.1% |
0.5% |
|
|
USD |
Personal Spending (MoM) |
0.8% |
0.6% |
0.4% |
|
USD |
Chicago PMI |
62.2 |
63.1 |
64.0 |
|
USD |
Michigan Consumer Sentiment Index |
76.2 |
75.1 |
74.3 |
Economic Events for Monday, April 2, 2012 Europe and America
08:15 CHF Retail Sales (YoY)
Retail Sales measure the change in the total value of inflation-adjusted sales at the retail level. It is the foremost indicator of consumer spending, which accounts for the majority of overall economic activity.
08:30 CHF SVME PMI
08:50 EUR French Manufacturing PMI
08:55 EUR German Manufacturing PMI
09:00 EUR Manufacturing PMI
09:30 GBP Manufacturing PMI
Manufacturing Purchasing Managers Index (PMI) measures the activity level of purchasing managers in the manufacturing sector. A reading above 50 indicates expansion in the sector; a reading below 50 indicates contraction. Traders watch these surveys closely as purchasing managers usually have early access to data about their company’s performance, which can be a leading indicator of overall economic performance.
10:00 EUR Unemployment Rate
The Unemployment Rate measures the percentage of the total work force that is unemployed and actively seeking employment during the previous month. The data tends to have a muted impact as there are several earlier indicators related to labor conditions in the euro zone.
15:00 USD ISM Manufacturing Index
The Institute of Supply Management (ISM) Manufacturing Purchasing Managers Index (PMI) rates the relative level of business conditions including employment, production, new orders, prices, supplier deliveries, and inventories.
The data is compiled from a survey of approximately 400 purchasing managers in the manufacturing industry.
On the index, a level above 50.0 indicates industry expansion, below indicates contraction.
Government Bond Auctions (this week)
Apr 03 09:30 Belgium Auctions 3 & 6M T-bills
Apr 03 09:30 UK Conventional Gilt Auction
Apr 04 08:30 Spain Bono auction
Apr 04 14:30 Sweden Details T-bill auction on Apr 11
Apr 05 08:50 France OAT auction
Apr 05 15:00 US Announces auctions
Apr 05 15:30 Italy Details BOT on Apr 11 & BTP/CCTeu on Apr 12
Originally posted here
