Bad employment report?? That’s no problem for the pound! Yesterday the currency still managed to rally against the dollar and the yen. GBP/USD ended the day 188 pips above its opening price at 1.6104 while GBP/JPY closed at 127.19, 82 pips above its opening price.
The claimant count change report for June disappointed yet again when it printed at 24,500. Analysts had only expected that the change in the number of people who filed for unemployment benefits for the month was only at 15,100.
On a brighter note though, average earnings for May rose by 2.3% and beat the market consensus which was for a 2.0% uptick. Also, the unemployment rate remained steady for May at 7.7%.
Without any economic report from the U.K. today, make sure you pay attention to the reports we have for the pound’s counterparts. Be on your toes for any changes in market sentiment too. See if the market is still hung over Fed Chairman Ben Bernanke’s remarks of the possibility of QE3. If it still is, we may just see the pound rally in today’s trading!
What a snoozer! Due to the lack of economic reports from the U.K., Cable remained by its session highs and lows. It bottomed out many times at the 1.6100 major psychological level and found resistance at 1.6190. At the end of the day, Cable sat at 1.6138, merely 34 pips higher from its opening price that day.
With absolutely nothing on U.K.'s forex calendar, we could see Cable continue to trade within a range. Keep a close eye on yesterday’s high and lows, as they could very well hold! Be careful of U.S. data though, as the preliminary University of Michigan consumer sentiment survey and consumer price index are due.
Ooomph! The pound took hits against its major counterparts last Friday when word started spreading that the U.K. is in for more disappointing economic data. GBP/USD struggled near its open price at 1.6136, while EUR/GBP peaked at an intraday high of .8796 before closing at .8768.
Judging from the disappointing Rightmove house price index released last weekend, it looks like the rumors were right! The data clocked in a 1.6% decline in July, which is not only worse than June’s 0.6% gain, but is also the first decline this year. Yikes!
No reports will be released from the U.K. today, but brace yourselves for the MPC meeting minutes and Nationwide consumer confidence reports on Wednesday at 8:00 – 10:00 am GMT, as well as the public borrowing and retail sales reports on Thursday at 8:30 am GMT.
Good luck in your trades today, kiddos!
The British pound got a heavy pounding yesterday despite the lack of economic data from the U.K. GBP/USD slid below the 1.6100 handle and closed at 1.6057 while GBP/JPY ended the day 5 pips below the 127.00 mark. What does today’s set of data bring for the pound?
Just like yesterday, the economic schedule of the U.K. is empty again, which means that pound pairs will have to rely on risk sentiment for their movement. For now, risk aversion still seems to be looming over the markets as euro zone debt concerns just won’t go away. Still, we’ve all witnessed how risk sentiment shifts on a dime so I wouldn’t be surprised if we see a sudden change in the wind today. Make sure you check out my daily commentary on the U.S. or my forex fundamentals on Japan if you plan to trade GBP/USD or GBP/JPY.
Risk was on like Donkey Kong yesterday, which explains why the pound performed well against its major counterparts yesterday. GBP/USD reached an intraday high of 1.6179 before settling at 1.6125, while GBP/JPY shot up by 79 pips to 127.74.
It seems that the pound bulls got a chance to stretch their muscles yesterday when the lack of economic reports in the U.K. drove investors’ attention to risk appetite in markets.
Today we’ll see if the pound is better off with the U.K. not releasing economic reports. The MPC is scheduled to release its monetary policy meeting minutes today at 8:30 am GMT, which followed by the Nationwide consumer confidence data at 11:00 am GMT.
Recall that a few weeks ago the committee unanimously decided to keep its interest rates at 0.50%. This time around, many analysts believe that nothing much has changed since the last monetary policy meeting, and that the MPC is likely to keep its dovish stance this month.
Stick around for these reports, kiddos!
“I get knocked down, but I get up again,” sang the pound as it had Tubthumping price action yesterday. GBP/USD dipped to a low of 1.6069, but managed to close 35 pips above its 1.6125 open price. GBP/JPY, on the other hand, struggled to stay above the 127.00 handle and managed to close at 127.28. Will the pound go on to sing “You’re never gonna keep me down” today?
Risk appetite extended its stay in the markets as both the U.S. and euro zone seemed closer to reaching the end of its debt problems. It also helped that the minutes of the latest BOE monetary policy meeting revealed that the central bank officials weren’t as dovish as they used to be. Although they pointed out that there are still several threats facing the U.K. economy, they acknowledged that growth has been steady for the second quarter of the year. Despite that, the BOE is widely expected to keep rates on hold for the remainder of 2011.
Today, the U.K. is set to release its public sector net borrowing report and its retail sales figure for June. After sliding by 1.4% during the previous month, consumer spending is projected to rebound by 0.5% in June. A stronger than expected figure could provide another boost for the pound so keep an eye out for the release at 8:30 am GMT.
Meanwhile, public borrowing is expected to drop from 15.2 billion GBP in May to 11.8 billion GBP in June, showing that the budget deficit is smaller. This report is also due 8:30 am GMT.
It’s all good in the hood for the pound! Not only did it get a boost from risk appetite, but it was also lifted by awesome retail sales data. Needless to say, pound bulls went nuts and carried GBP/USD 139 pips higher and GBP/JPY 58 pips higher.
Who would’ve thought Britons would make it rain? Instead of posting a 0.5% uptick, retail sales in June managed to surge by 0.7%. Considering that May had recorded a 1.3% drop (the largest in over a year!), this strong pickup in spending is a sight for sore eyes! Apparently, the bulk of spending last month came from non-food and auto fuel sales. It was also noted that lower prices played a big role in boosting consumption.
In other news, no fireworks went off when the public sector net borrowing report came out. Public borrowing last month was more or less in line with expectations (a bit stronger than the 11.8 billion GBP forecast) showing a 12.0 billion GBP figure.
Today, it looks like we’ll have to shift our attention outside the U.K. since it won’t be publishing any economic reports. In the meantime, keep your eyes peeled for any developments regarding the U.S. debt ceiling situation as today is Obama’s deadline to make a decision.
It’s a stalemate, folks! After a day of scoring wins against its rivals, the British pound ended unchanged against the U.S. dollar and the Japanese yen on Friday. GBP/USD closed right at the 1.6300 handle while GPB/JPY landed at 127.85. Can the pound push for more gains this week?
The U.K. didn’t release any economic reports on Friday, which was probably why their currency was unable to make any gains or losses against the dollar or the yen. This week, the U.K. is set to report a bunch of top tier data, so hold on to your hats!
First up, the BBA mortgage approvals is due 8:30 am GMT today. The report could show that new mortgages rose from 30.5K to 31.3K in June, reflecting an increase in housing market demand. A stronger than expected figure could help the pound go for more gains today, while a weak figure could erase some of its recent wins.
Tomorrow’s gonna be even more exciting for the pound since the U.S. is set to reveal its second quarter GDP reading. After posting 0.5% economic growth in the first quarter, the U.K. could show that the expansion slowed down during the second quarter with a 0.2% GDP figure. With U.K. economic indicators, such as services and manufacturing PMI, printing weaker figures for the past months, we probably should brace ourselves for a downside surprise in U.K. GDP. Stay tuned for the actual figure due Tuesday 8:30 am GMT.
Wednesday has the CBI industrial orders expectations report on tap. This could show that decreasing order volume is expected for this month, with the reading projected to fall from 1 to -2. Then, on Thursday, the CBI realized sales report will be released. This time around, higher sales volume is predicted since the index is estimated to jump from -2 to 2. Last but not least, the net lending to individuals report is due Friday and this could show that lending held steady at 1.3 billion GBP in June.
It was a relatively dull day for the pound as it traded flatly against the dollar and the euro. Are pound traders merely saving energy for today’s big GDP report?
No one seemed to mind yesterday’s BBA mortgage approvals report, which showed that approvals rose from 30,800 to 31,700 in June. Banks are still lending out dough for house purchases, but overall, the mortgage market is still frail as it’s still down 6% year-on-year.
Anyway, that’s all behind us now. At this point in time, it’s best we focus all our attention on the upcoming U.K. GDP report due at 8:30 am GMT. The U.K.'s economic growth is said to have softened from 0.5% to 0.2% in Q2 2011. Will stronger-than-expected manufacturing production and retail sales lift GDP or will weak demand drag it down? To learn more about what to expect, check out Forex Gump’s guide to Trading the U.K. GDP Report.
Fo’ sho’ this will be the main market driver for the pound today, so don’t miss it!
Ain’t no thang but a chicken wing! On the strength of relatively decent economic data, Cable soared to its highest level in 6 weeks, gaining 124 pips to finish at 1.6414. Can the pound continue to dominate or is a midweek reversal in play?
I guess in some cases, “not bad” is good enough! A report released yesterday revealed that the U.K. economy grew by 0.2% last quarter, which was right in line with expectations. This marked the second straight quarter of growth for the British economy, and if it weren’t for additional holidays and Japan’s struggles, naysayers believe that the GDP figure could have been as high as 0.7%! Not bad old chap!
Looking at today’s calendar, we’ve got the CBI industrial orders expectations index coming in at 10:00 am GMT. The index is projected to print at -2, down from last month’s reading of 1. This indicates that businesses are expecting order volume to tick down over the next three months. I don’t expect this report to shock the markets too much, but a positive figure could give pound pairs some support as we hit the middle of the week.
Just when you thought it’d be clear skies ahead for the pound, out come pound bears to drag the currency down! With weak U.K. data and dovish BOE statements working for them, they pulled GBP/USD 76 pips lower. Is this a reversal in the works?
Well, the good vibes from Tuesday’s GDP report certainly didn’t last long! Yesterday’s worse-than-expected CBI industrial order expectations data made sure of that! The report, which surveys about 550 different manufacturers, revealed that optimism for the general business environment dropped for the first time in two year!
The index eased from -2 to -10 in July as manufacturers braced themselves for what they believe will be a tough third quarter. Some businesses are planning to cut back on their investments while others say they’ll have to fire some workers. Ouch. Definitely not good news for Britons.
In other news, MPC member David Miles spurred on sellers even more and scared the living daylights out of investors when he said that the U.K. could fall back into recession. He believes that although it’s not a likely scenario, it remains a very real possibility.
Today, look for the CBI realized sales index (due 10:00 am GMT) to rise from -2 to 1. Just keep in mind that this report probably won’t have much weight to it since it’s not one of the reports that’s widely followed. So in the meantime, look for developments in the U.S. to direct GBP/USD. Peace out!
You know what they say about outrunning a lion – you only gotta outrun the person next to you! And that’s exactly what the pound’s been doing! With everyone souring on the euro zone and the U.S., GBP/USD managed to edge 10 pips higher from its opening price to end the day at 1.6346.
The main reason why the pound gained managed to stay afloat is because the focus right now is on European contagion fears and the U.S.’ debt ceiling problems. The pound has somewhat benefited from this odd situation, but it remains to be seen whether this can continue over the next few weeks. For all we know, risk aversion will take over the markets and we could see the pound tumbled down the charts!
The CBI realized sales report that was released yesterday came in worse than expected, printing a score of -5. Analysts were predicting that the index would come in at 1 and show higher sales growth. Instead, this marked the second consecutive negative figure for the index, indicating weakness in the manufacturing sector.
Moments ago, the GFK consumer confidence index also showed a worse-than-expected figure of -30. Early estimates were predicting a -26 figure. This highlights deteriorating consumer confidence, which isn’t good for the economy. If people ain’t confident about the economy, then they become more prone to keeping their hard earned quid in their wallets.
For today, we’ve got the Nationwide HPI and net lending to individual reports coming in at 6:00 am GMT and 8:30 am GMT respectively. Housing prices are projected to have ticked down slightly by 0.1% in the past month. Meanwhile, consumers are expected to have taken out loans to the tune of 1.3 billion GBP, right in line with what they borrowed last month.
Still, I don’t think the markets will focus too much on these reports. Today, I think the main focus will be on whether or not the U.S. will resolve their debt ceiling woes. If they don’t, all hell might break loose! Be careful out there kiddos!
After mixed reports were released and dropping like it’s hot to an intraday low of 1.6261, GBP/USD skyrocketed up the charts to close the day 67 pips higher from its opening price of 1.6413. Now that’s a perfect stop-and-reverse move right there!
Last Friday we saw that consumer confidence deteriorated even further in July when the GfK consumer confidence report printed at -30 following its -25 reading for June and disappointing the consensus which was for a more modest decline to -26.
There was also the net lending report that failed to impress markets when it came in at a measly 400 million GBP and fell short of the expected 1.3 billion forecast.
However, on a brighter note, Nationwide reported that house prices increased by 0.2% in July and topped expectations for a 0.1% downtick.
The pound bulls were lucky that the market was still focused on the U.S. debt ceiling and the lack of any significant developments weighed on the dollar’s performance.
I wonder if the manufacturing report for July, on tap later at 8:30 am GMT, will be able to provide the pound with a boost on the charts. Watch out for a figure better than the expected 51.1 reading as this would probably be bullish for the currency!
With risk aversion in full tow, the markets had pound bulls screaming “Bollocks!” all throughout the New York Session. GBP/USD closed 118 pips lower at 1.6297, while GBP/JPY hit an intraday low at 124.19 before recovering to finish at 125.70, marking a 105 pip loss on the day.
One piece of data that set the bearish tone for the pound was the manufacturing PMI, which came in at a disappointing 49.1. This marked the FIFTH consecutive month that the index failed to hit consensus targets, and also indicates that manufacturing activity contracted in the past month.
In the end though, it was overall risk aversion that caused the pound to weigh in lower (pun intended). European contagion fears as well as concerns about the global recovery plagued the markets and as long as this continues, it will be difficult for higher yielding currencies like the pound to post any gains.
Looking ahead, we’ve got the construction PMI coming in today at 8:30 am GMT. The index is projected to print at 53.2, a slightly lower reading than last month’s 53.6. Keep an eye on this report, as it could set the tone for pound trading for the rest of the trading day.
Despite positive data, the pound was able to end the day with a win against the dollar by a hairsbreadth when GBP/USD closed 9 pips from its opening price at 1.6308. Meanwhile, it pared its initial gains against the yen and closed at its opening price of 125.70.
Unlike the manufacturing PMI report, the construction PMI for July allowed investors to breathe a sigh of relief when it came in higher at 53.5 than the 53.2 consensus.
However, perhaps the bad vibes brought about by the manufacturing PMI still lingered in the markets yesterday and kept the pound from rallying.
I wonder how the services PMI would fare against the other indices. At 8:30 am GMT later, we’ll get dibs on how the service sector of the U.K. did in July. Watch out for a figure higher than the 53.3 consensus as this would probably be bullish for the pound.
Thanks to the very positive Services PMI, the pound was able to edge higher versus other major currencies in yesterday’s trading session. The pound was able to steal 119 pips from the dollar and 74 pips from the yen.
The U.K. services PMI printed a reading of 55.4, an improvement from the previous month’s reading of 53.9 and the 53.3 forecast. The services sector is considered one of the most important areas of the British economy, so the positive news provided a lot of relief for the weakened pound.
Today, focus will turn to the Bank of England (BOE) interest rate decision at 11:00 am GMT. Since the market widely expects the bank to keep rates unchanged at 0.50%, pay attention instead to the bank’s tone. Hawkish statements (e.g., hints of a hate rite, concerns rising inflation, etc.) usually give the pound support while dovish statements (i.e., relaxed stance towards inflation or rate hikes) tend to weaken the pound.
Boy! There’s nothing like risk aversion to get the market sheddin’ pounds! GBP/USD ended the day at 1.6269, 159 pips below its opening price. Meanwhile, GBP/JPY retreated from its intraday high of 130.87 to end the day at 128.71.
Concerns over the capability of euro zone countries to pay their debts dominated market sentiment and had investors fleeing higher-yielding currencies. Aside from that, it also didn’t help that the market didn’t see any pleasant surprise in the BOE’s interest rate decision.
As everyone expected, the BOE MPC left rates unchanged at 0.5% and maintained its asset purchase facility of 200 billion GBP. From what I’ve heard from a few market junkies, it seems like the MPC was more concerned of slowing growth in the U.K. than the rising inflation.
However, perhaps the PPI report for July will be able to get investors giddy that rising prices in the country is something the BOE can just ignore. At 8:30 am GMT, the PPI input report is anticipated to print a 0.6% uptick, higher than the 0.4% reading we saw for June. Meanwhile, the price of goods sold by manufacturers is anticipated to post a modest increase of 0.2% for the month.
Watch out for positive figures as these will probably be bullish for the pound!
But before the PPI figures, we’ll get dibs on how the U.K. housing market is doing. At 7:00 am GMT, the Halifax HPI for July seen to show a 0.1% increase in house prices.
Last Friday provided another green day for the pound bulls as better-than-expected reports from the U.K. mixed in with broad dollar weakness in markets. Cable ended up flying by 122 pips to 1.6390, while GBP/JPY eased from its 127.40 intraday low and closed at 128.62.
Even though markets were focused on the NFP report and the Greenback drama last Friday, the pound was able to sneak in gains on its better-than-expected Halifax house price index. The report came in with a 0.3% growth in July when market geeks were only looking for a 0.1% growth. Meanwhile, producer prices in the U.K. accelerated by 0.6% in July, which pushed its annualized rate to the fastest rate since October 2008. Will fast acceleration of producer prices weaken the BOE’s dovish stance?
Maybe not in the near future. You see, the BOE (and the rest of the world markets) is currently fidgeting about the U.S. credit rating downgrade drama as well as the possibility of a slowdown in global economic recovery. In the meantime though, we can turn our trading focus to the U.K. reports around the corner this week.
The reports will start pouring in today at 11:00 pm GMT when the U.K. releases its RICS house prices report and the BRC prints its retail sales report. A positive RICS data might support the Halifax index we saw last week, which might give lift the pound higher in the charts.
The action will continue tomorrow at 8:30 am GMT when the country releases its manufacturing production, trade balance, and industrial production report. Pretty major reports, if you ask me. At 2:00 pm GMT the National Institute of Social Economic Research (NIESR) will publish its GDP estimate for the second quarter.
The last major reports to come our way this week will be the BOE inflation report on Wednesday at 9:00 am GMT, followed by a speech by the BOE Governor Mervyn King. Lastly, the CB leading index will be published on Thursday at around 9:30 am GMT.
Don’t even think of missing these reports, kids!
It got crazy in the U.K. yesterday, and no, I’m not just talking about the riots. The pound took a backseat against most of its counterparts yesterday on mixed economic data from the U.K. and risk aversion in markets. GBP/USD went down by 124 pips to 1.6341, while EUR/GBP slipped back by 54 pips to .8696.
Too bad the U.K. economic reports weren’t enough to save the pound. As we’ve seen yesterday, the BRC retail sales monitor gained by 0.6% in July after falling by the same rate in June. Meanwhile, the RICS house price balance showed another 22% decline in July.
Employment outlook in the country also weakened in the same month, which might’ve been the straw that broke the camel’s back and motivated traders to sell the pound like there’s no tomorrow. As bad as the situation is for the U.K., it could be worse. Heck, the pound still gained against the euro!
Will the pound bulls hustle some muscle in the charts today? The U.K. is set to release its manufacturing production report today at 8:30 am GMT, which is around the time the country’s trade balance and industrial production report will also be released. If the report prints worse than market geeks had priced in, then we just might see the pound drop faster than you can say “KABLAM!”
Due to the social unrest in the streets of U.K., Cable took a hit in yesterday’s trading session. Cable, after it had opened the day at 1.6341, traded as low as 1.6176 before recuperating its losses slightly to end the U.S. trading session at 1.6292. All in all, the pair lost 49 pips.
It also didn’t help that data from the U.K. disappointed. The manufacturing production report came in at -0.4% instead of the 0.3% gain consensus. Meanwhile, the trade balance showed a 8.9 billion GBP deficit, which was slightly higher than the 8.2 billion GBP deficit initially expected.
Today, the only important economic event on U.K.’s economic calendar is Bank of England Governor Mervyn King’s inflation reports. At 9:30 pm GMT, King is scheduled to hold a press conference, along with other financial officials, about U.K.’s inflation and economic situation.
With growth slowing and the overall uncertainty in the global economy, the market is expecting a bearish tone from the BOE. If the market is correct, it could lead to a Cable sell-off. Be careful trading today!