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GBP/USD Fundamental Analysis, May 11, 2015 – Forecast

gbpusd friday bnsAnalysis and Recommendations:

The GBP/USD rallied and rallied some more as David Cameron and the Conservatives won the elections doing much better than expected leaving Labor in the dust. The pound added 234 points to trade at 1.5479.  The pound remained at its highest levels in a week on Friday, driven by news that the Conservative Party will likely win the U.K. election, after a night of surprises at the ballot box.

The pound had been trading around $1.5249 ahead of Thursday’s election. An initial jump for the pound came late Thursday as exit polls showed a strong result for the Conservatives.

As the old mantra goes, “markets hate uncertainty,” said Louise Cooper, independent analyst at Cooper City, in a note. “[Prime Minister David] Cameron has governed for the last five years and investors know what they are getting with Cameron and [Chancellor George] Osborne. Better the devil you know, and all that,” she said.

With the bulk of results in, the Conservatives look set to win 329 seats in Parliament, giving it a working majority, despite opinion polls that had showed a tighter race and a possible coalition government. The surprise in the election has come after months of pre-election surveys predicting a dead heat. Should the projections prove correct, Cameron is expected to keep his job as prime minister.

ForexTraq 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.

Today’s economic releases actual vs. forecast:

Cur.

 

Event

Actual

Forecast

Previous

 

  JPY

 

Monetary Policy Meeting

 

 

 

 

 

  AUD

 

RBA Monetary Statement  

 

 

 

 

 

  CNY

 

Exports (YoY) (Apr)

-6.4%

2.4%

-15.0%

 

 

  CNY

 

Imports (YoY) (Apr)

-16.2%

-12.0%

-12.7%

 

 

  CNY

 

Trade Balance (Apr)

34.13B

39.45B

3.08B

 

 

  EUR

 

German Industrial Production

-0.5%

0.4%

0.2%

 

 

  EUR

 

German Trade Balance (Mar)

19.3B

20.0B

20.0B

   

  GBP

 

Halifax House Price Index (YoY)

8.5%

7.8%

8.1%

 

 

  GBP

 

Halifax House Price Index

1.6%

0.4%

0.6%

   

  GBP

 

Trade Balance (Mar)

 

-9.80B

-10.34B

 

 

  GBP

 

Trade Balance Non-EU (Mar)

 

-2.95B

-3.24B

   

 GBPUSD(60 minutes)20150508103439

Upcoming Economic Events that you should be monitoring:

Monday, May 11, 2015

Cur.

 

Event

Actual

Forecast

Previous

 

 

 

 

Russia – Victory Day

  AUD

 

NAB Business Confidence (Apr)

 

 

3

 

 

  GBP

 

BoE QE Total (May)

 

 

375B

 

 

  GBP

 

Interest Rate Decision (May)

 

0.50%

0.50%

   

Government Bond Auctions

Date Time Country

May 12 09:15 Norway Holds bond auction

May 13 09:10 Italy Auctions BTPs/CCTeus

May 13 09:30 Germany Eur 3bn Feb 2025 Bund

May 13 14:30 Sweden Details bond auction on 20 May

May 14 09:30 UK Auctions 2% 2020 Conventional Gilt

 

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