By FXEmpire.com
Analysis and Recommendations:
The GBP/USD continues to fall, trading at 1.5537, as the pound cannot stand against the strength of the USD. Even with poor housing reports in the US, and several other lackluster reports in the US this week, the risk aversion mode of the markets continues to push the DI to new heights. The Index is not at 82.87
Today the Bank of England said that net lending to individuals rose more-than-expected in April, rising by GBP1.4 billion, beating expectations for a GBP1.2 billion increase. A separate report showed that U.K. mortgage approvals ticked higher last month. Both of these reports are second tier and have little effect on the markets and the overall value of the sterling, but give a better look as economic indicators.
Until the EU pulls some rabbits out of the hat, and until the politicians and Spain and Greece get their acts together, the euro will continue to tumble and risk aversion and safe havens will remain the theme.
The euro continues to drift lower, now holding under the 1.25 level as problems in the EU burst everywhere today. Spain and Italy saw their bond rates soar, while Greek polls showed that the election favors the anti EU movement picking up momentum and taking the lead.
In Spain, the Prime Minister clarified his statements of early this week, saying that Spain would recapitalize their banks and then raise the money through bond sales, as rates rose to 6.7% today. The ECB claims that they were not approached about the earlier scenario for Spain to loan the money to the banks and then for Spain to use that paper to borrow from the ECB.
The EC is now suggesting that they use the ESFM, the permanent rescue fund, to help Spain, which would be a bailout, although Spain is not requesting a bailout.
Markets are trying to tell the EU that they have bought enough time, two years in fact, and they continue to procrastinate. Several months ago, their backs were against the wall and the ECB and the EU and the EC promised a roadmap and plan to lead the EU back to health, which has never materialized. Next came the Fiscal Pact which still has not materialized and then Stability Mechanisms, which has never really been funded or developed. And still they procrastinate and delay. We are about to see Spain, Italy and Greece implode or explode but doomsday awaits as everything gathers for a grand finale in June.
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 up to the data analysis and information in our weekly reports.
Economic Data for May 30, 2012 actual v. forecast
|
Date |
Currency |
Event |
Actual |
Forecast |
Previous |
|
May 30 |
JPY |
BoJ Governor Shirakawa Speaks |
|||
|
AUD |
Construction Work Done (QoQ) |
5.5% |
3.0% |
-3.4% |
|
|
AUD |
Retail Sales (MoM) |
-0.2% |
0.2% |
1.1% |
|
|
CHF |
KOF Leading Indicators |
0.81 |
0.48 |
0.43 |
|
|
EUR |
Italian 10-Year BTP Auction |
6.03% |
5.66% |
Upcoming Economic Events that affect the CHF, EUR, GBP and USD
|
Date |
Time |
Currency |
Previous |
|
|
May 31 |
5:45 |
CHF |
GDP q/q |
0.1% |
|
31st-3rd |
EUR |
German Retail Sales m/m |
0.8% |
|
|
6:45 |
EUR |
French Consumer Spending m/m |
-2.9% |
|
|
7:55 |
EUR |
German Unemployment Change |
19K |
|
|
9:00 |
EUR |
CPI Flash Est?mate y/y |
2.6% |
|
|
12:15 |
USD |
ADP Non-Farm Employment Change |
119K |
|
|
12:30 |
USD |
Prelim GDP q/q |
2.2% |
|
|
12:30 |
USD |
Unemployment Claims |
370K |
|
|
13:45 |
USD |
Chicago PMI |
56.2 |
|
|
15:00 |
USD |
Crude Oil Inventories |
0.9M |
|
|
Jun 1 |
TBD |
GBP |
Halifax HPI m/m |
|
|
7:15 |
CHF |
Retail Sales y/y |
4.2% |
|
|
7:30 |
CHF |
SVME PMI |
46.9 |
|
|
7:45 |
EUR |
Italian Manufacturing PMI |
43.8 |
|
|
8:30 |
GBP |
Manufacturing PMI |
50.5 |
|
|
9:00 |
EUR |
Unemployment Rate |
10.9% |
|
|
12:30 |
USD |
Non-Farm Employment Change |
115K |
|
|
12:30 |
USD |
Unemployment Rate |
8.1% |
|
|
12:30 |
USD |
Core PCE Price Index m/m |
0.0% |
|
|
12:30 |
USD |
Personal Spending m/m |
0.2% |
|
|
12:30 |
USD |
ISM Manufacturing PMI |
0.3% |
|
|
14:00 |
USD |
S&P/CS Composite-20 HPI y/y |
54.8 |
Government Bond Auctions
May 31 14:30 Sweden
Jun 04 10:00 Norway
Jun 05 00:30 Japan Jun 05 09:30
Jun 05 14:30 Sweden
Jun 06 09:30 Germany
Jun 06 09:30 Portugal
Jun 06 14:30 UK
Jun 07 00:30 Japan
Jun 07 08:30 Spain
Jun 07 08:50 France
Jun 07 09:10 Sweden
Jun 07 15:00 US
Jun 08 10:00 Belgium
Jun 08 15:30 Italy
Click here a current GBP/USD Chart.
Originally posted here
