By FX Empire.com

The GBP/USD showed some volatility amid worries stemming from the euro area and improvement in U.K. data.

Last week, speculations increased that leaders of the largest two euro area economies are divided over the role played by the ECB and leveraging the EFSF, while German announcements referred that the coming European meeting will not be the final in solving the crisis.

In the same context, Moody’s downgraded Spain’s credit rating by two notches to A1 from Aa2 while Standard and Poor’s said “sovereign ratings on France, Spain, Italy, Ireland, and Portugal likely would be lowered by one or two notches.”

On the other hand, U.K. retail sales with auto fuel advanced to the highest level in five months in September and budget deficit excluding support for banks narrowed to 14.1 billion pounds in September from 15.4 billion pounds deficit a year before. While inflation skyrocketed to 5.2% in September, the BoE sees that domestic inflation is contained and expected to fall below target over the medium term, where policy makers were united over October’s monetary decision which included holding borrowing cost at 0.50% while boosting the Asset Purchase Facility by 75 billion pounds to reach 275 billion pounds.

This week, the main focus will be on growth data from the United States amid the absence of important fundamentals from the British economy.

The release of the data this week will be as follows:

Monday October 24:

Both economies lack economic fundamentals which propose that there would be calm trading on the pair which is predicted to follow the general trend in market as it will not able to get direction from data.

Tuesday October 25:

At 04:30 GMT, the U.K. will release BBA loans for house purchase for Sep. and current account for the second quarter. Consumer confidence, in theU.S., due at 14:00 GMT, will rise to 46.0 in October from 45.4 a month before, according to median estimates.

Wednesday October 26:

The U.K. will release CBI trends for August at 10:00 GMT, yet it is not expected to have an impact on the pair,

For the U.S., MBA mortgage applications for August 19 at 11:00 GMT followed by durable goods orders, due at 12:30 GMT, which is projected to slide 0.7% in Sep. relative to the preceding 0.1% drop.

At 14:00 GMT, new home sales report for Sep. is expected to show 1.7% rise from the prior 2.3% fall.

Thursday October 27:

The main highlight of the week which is GDP annualized for the third quarter, which is predicted to record 2.3% from 1.3% growth in the second quarter, will be available at 12:30 GMT. At the same time, initial jobless claims for the week ended Oct. 22 and continuing claims for the week ending Oct. 15. Thereafter, specifically at 14:00 GMT, pending home sales will show 0.1% rise in Sep. from the previous 1.2% fall.

On the other hand, as of 23:01 GMT, U.K. GfK consumer confidence survey will remain unchanged at minus 30.

Friday October 28:

The week ends with the release of no fundamentals from the U.K., while in the U.S. personal income and spending will be under scrutiny at 12:30 GMT, followed by University of Michigan confidence will show a rise to 58.0 in Oct. from the prior 57.5.

Read more Weekly Forex Analysis here.