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- Mar, 19 British Pound Weighed by Risks for Double-Dip Recession, Euro Extends Decline
- Mar, 18 Euro Sunk As Greece Bailout At Risk, Sterling Troubled By Disappointing Mortgage Approvals
- Mar, 17 British Pound Rallies as U.K. Jobless Claims Slump 32.3K, Euro Maintains Narrow Range
- Mar, 16 U.S. Dollar Loses Ground Ahead of FOMC Interest Rate Decision
- Mar, 15 Euro, British Pound Pare Previous Week’s Advance on U.S. Dollar Strength
- Mar, 12 Euro Rallies as Growth Prospects Improve, British Pound Extends Rebound
- Mar, 11 British Pound Advances as Inflation Expectations Push Higher, Euro Holds Tight Range
- Mar, 10 Euro Holds Narrow Range, British Pound Extends Decline as U.K. Manufacturing Falters
- Mar, 09 Euro, British Pound Slump as Investors Scale Back on Risk Appetite
- Mar, 08 Euro Maintains Range From Previous Month, British Pound Little Changed Overnight
- Mar, 05 Euro, British Pound Little Changed Ahead of U.S. Non-Farm Payrolls
- Mar, 04 British Pound Pares Decline as BoE Maintains Current Policy, ECB Holds Interest Rate at 1.00%
- Mar, 03 Euro Advances as Greece Announces Additional Measures to Curb Deficit, British Pound Halts Six-Day Decline
- Mar, 02 British Pound Extends Decline, Euro Slips to Fresh Yearly Low
- Mar, 01 Euro, British Pound Weighed by Economic Uncertainties – U.S. Dollar Rallies Across the Board
- Feb, 26 British Pound Fails to Benefit From Enhanced 4Q GDP Report, U.S. Dollar Mixed
- Feb, 25 British Pound Extends Decline as 4Q Investments Disappoint, Euro Weighed by Risk Aversion
- Feb, 24 Euro, British Pound Advance Ahead of Fed Chairman Bernanke’s Testimony
- Feb, 23 British Pound Weighed by Bank of England Testimony, Euro Gives Back as Risk Appetite Falters
- Feb, 22 Euro, British Pound Consolidate Overnight As Markets Await Clarity On Greece Bailout And Fed Direction
The British Pound is little changed from the previous day and continued to hold the broad range carried over from the previous, but we may see the GBP/USD face increased volatility going into the North American trade as investors wait for the U.S. advanced 4Q GDP report due out at 13:30 GMT.
Talking Points
• Japanese Yen: Weighed by Risk Appetite
• Pound: BoE Completes Asset Purchases
• Euro: CPI Estimate Falls Short of Expectations
• US Dollar: 4Q GDP, Chicago PMI on Tap
Euro, British Pound Remain Little Changed Ahead of U.S. 4Q GDP
The British Pound is little changed from the previous day and continued to hold the broad range carried over from the previous, but we may see the GBP/USD face increased volatility going into the North American trade as investors wait for the U.S. advanced 4Q GDP report due out at 13:30 GMT. Meanwhile, the Bank of England announced that it met the GBP 200B target for its asset purchase program and said that the emergency measures will be under review at its policy meeting next week, along with “its latest inflation projections.”
Nevertheless, consumer confidence in the U.K. increased for the first time in three-months, with the GfK survey rising to -17 in January from -19 in the previous month, and conditions are likely to improve going forward as the economy emerges from its worst recession since the post-war period. At the same time, the Nationwide Home Price index surged 1.2% in January to top expectations for a 0.3% rise and mark the fastest pace of growth in five-months, while the annualize rate increased 8.6% from the previous year after rising 5.9% in December. The data encourages an enhanced outlook for the region and economic activity should continue to pick up as the expansion in monetary and fiscal policy continues to feed through the real economy. As a result, the BoE is widely anticipated to hold the benchmark interest rate at 0.50% next Thursday as the central bank aims to encourage a sustainable recovery, and the MPC may hold a hawkish outlook for future policy as price pressures intensify.
The Euro slipped to a fresh monthly low of 1.3912 during the overnight trade, and the single-currency may continue to trend lower over the near-term as policy makers expect to see a protracted recovery. Nevertheless, the consumer price estimate for the Euro-Zone increased to an annualize pace of 1.0% in January from 0.9% in the previous month, which fell short of expectations for a rise to 1.2%, while the unemployment rate increased to 10.0% in December from a revised 9.9% in the month prior. At the same time, European Central Bank President Jean-Claude Trichet said that it is “essential” for the governments operating under the single-currency to have a credit plan to normalize public finances, and reiterated that a strong U.S. dollar policy “also corresponds to the overall superior interest of the global economy.”
U.S. dollar price action was slightly mixed overnight, with the USD/JPY advancing to a high of 90.36, and the greenback is expected to face increased volatility going into the North American trade as the Commerce Department is scheduled to release the advanced 4Q GDP report later today. Economic activity is forecasted to expand at an annual pace of 4.7% after rising 2.2% during the three-months through September, while the gauge for personal consumption is projected to increase 1.8% from the previous quarter. At the same time the Chicago PMI is anticipated to fall to 57.2 in January from a revised 58.7 in the previous month, while the U. of Michigan confidence survey is expected to increase to 73.0 for the same period from an initial forecast of 72.8.
Will the EUR/USD Continue to Retrace the Advance from May? Join us in the Forum
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To discuss this report contact David Song, Currency Analyst: dsong@fxcm.com
DailyFX provides forex news on the economic reports and political events that influence the currency market.
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