By FXEmpire.com
Analysis and Recommendations:
The GBP/USD continues to trade strong at 1.6192 as the pound is able to maintain its strength against the USD.
Although the UK Service PMI reported under forecast, it did not have much of an effect on the markets.
The European Central Bank on Thursday left its main refi rate unchanged at 1%, as expected. Bank President Mario Draghi said the economic outlook remains subject to downside risks, tied in part to ongoing tensions in some sovereign debt markets. Draghi said the ECB will be on the lookout for signs. Draghi said there was “no contradiction” between euro-zone countries adopting a “growth compact” alongside a “fiscal compact.”
The difference here will be the Nonfarm Payroll report tomorrow and the upcoming BoE meeting next week, although Governor King said in a speech this week that he is prepared for the BoE to take on some heat by not taking the favorite road or easy path.
In the US there was positive and some not so positive data today.
The Institute for Supply Management said its services sector index in April dropped to 53.5% from 56.0% in March to mark the worst reading since December. Economists had forecast a 55.4% reading. U.S. productivity fell 0.5% in the first quarter, but none of the decline occurred in manufacturing. Economists expected productivity to fall by 1.0%. Growth in the U.S. services sector slowed in April, with a weakening pace of production, new orders and employment, according to a key index.
The number of Americans who filed requests for unemployment benefits fell last week for the first time in a month, down 27,000 to 365,000, In a separate report, U.S. employers planned to cut 40,559 jobs in April, an 11% increase from a year ago, according to outplacement firm Challenger, Gray & Christmas Inc. The April total is also up 7.1% from the 37,880 job cuts announced in March.
Economic Events for May 3, 2012 actual v. forecast
|
GBP |
Nationwide HPI (MoM) |
-0.2% |
0.5% |
-1.0% |
|
TRY |
Turkish CPI (MoM) |
1.52% |
1.18% |
0.41% |
|
GBP |
Services PMI |
53.3 |
54.6 |
55.3 |
|
EUR |
Interest Rate Decision |
1.00% |
1.00% |
1.00% |
|
USD |
Nonfarm Productivity (QoQ) |
-0.5% |
-0.5% |
1.2% |
|
USD |
Initial Jobless Claims |
365K |
380K |
392K |
|
USD |
Unit Labor Costs (QoQ) |
2.0% |
2.8% |
2.7% |
|
USD |
Continuing Jobless Claims |
3276K |
3311K |
3329K |
Economic Events for May 4, 2012 for the European and US Markets
08:15 CHF Retail Sales 1.2% 0.8%
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.
10:00 EUR Retail Sales 0.3% -0.1%
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.
13:30 USD Nonfarm Payrolls 170K 120K
Nonfarm Payrolls measures the change in the number of people employed during the previous month, excluding the farming industry. Job creation is the foremost indicator of consumer spending, which accounts for the majority of economic activity.
13:30 USD Unemployment Rate 8.2% 8.2%
The Unemployment Rate measures the percentage of the total work force that is unemployed and actively seeking employment during the previous month.
Government Bond Auctions (this week)
Date Time Country
May 08 09:15 Austria
May 08 09:30 Belgium
May 08 14:30 UK
May 08 15:30 Italy
May 08 17:00 US
May 09 09:10 Sweden
May 09 09:30 Germany
May 09 09:30 Swiss
May 09 09:30 UK
May 09 14:30 Sweden
May 09 15:30 Italy
May 09 17:00 US
May 10 15:00 US
May 10 17:00 US
May 11 09:10 Italy BOT auction
May 11 10:00 Belgium
Click here for updated GBP/USD News.
Originally posted here
