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GBP/USD Weekly Analysis Forecast, May 18-22, 2015 – Forecast

Weekly Analysis and Recommendation (GBP/USD Analysis Forecast):  

The GBP/USD had a great week soaring at the end of the previous week after the elections. The pound held on to last week’s gains to close the week at 1.5727. This week’s inflation report from the BoE and Mark Carney’s comments weighed on the currency but the GBP was able to hold its gains against the weak US dollar.

Investors had for months worried that no party would win a majority in last Thursday’s UK parliamentary election, which would have led to weeks of negotiations on a coalition government that many reckoned would have also spelled a weak spell for sterling.

But that risk evaporated when the Conservatives won an outright majority for the first time in 23 years. Sterling has risen around 3.5 per cent since the results were announced, taking its fortnightly rise to over 4 per cent — its strongest gains since May 2009.

Sterling slipped from almost-seven-year highs on Wednesday after the Bank of England cut its growth forecasts and warned about a strong pound’s impact on the outlook for interest rates.

The UK economy has outpaced much of Europe over the past two years, and the prospect that Britain will be the first to follow any rise in US rates has kept sterling strong – a worry for exporters facing off against euro zone competitors.

But the Bank’s latest quarterly Inflation Report backed market expectations that it will only start to raise rates in around a year’s time.

ForexTraq provides in-depth analysis for each currency and commodity we review in forex trading. 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 recent analysis and information for GBP/USD in our weekly reports and we provide daily updates and outlooks.

 Historical: From 2011 to Present

Highest: 1.6618 USD on Aug 19, 2011

Average: 1.5764 USD over this period

Lowest: 1.4832 USD on Mar 12, 2013

gbpusd chart

Major Economic Events for the week that you should be monitoring for GBP/USD in forex trading

Cur. Event

Actual

Forecast

Previous

Monday, May 18, 2015

Tuesday, May 19, 2015

  AUD Monetary Meeting Minutes

 

  GBP CPI (YoY)

 

  EUR German ZEW Economic Sentiment

 

49.0

53.3

  EUR CPI (YoY)

 

0.0%

0.0%

  USD Building Permits (Apr)

 

1.065M

1.042M

  CAD BoC Gov Poloz Speaks

 

Wednesday, May 20, 2015

  GBP BoE MPC Meeting Minutes

 

  USD FOMC Meeting Minutes

 

Thursday, May 21, 2015

  CNY HSBC Manufacturing

 

49.4

48.9

  EUR German Manufacturing

 

52.3

52.1

  GBP Retail Sales

 

0.4%

-0.5%

  USD Existing Home Sales

 

5.24M

5.19M

  USD Philadelphia Fed Manufacturing

 

8.2

7.5

Friday, May 22, 2015

  EUR German GDP

 

0.3%

0.3%

  EUR German Manufacturing

 

52.1

  EUR German Ifo Business

 

108.3

108.6

  USD Core CPI

 

0.2%

0.2%

Government Bond Auctions

Date Time Country

May 18 09:30 Germany Eur 1.5bn 12M (May 2016) Bubills

May 18 10:00 Belgium Auctions OLOs

May 20 09:03 Sweden Holds bond auction

May 21 08:30 Spain Auctions Bonos

May 21 09:03 Sweden Holds bond exchange auction

May 21 09:10 France Auctions BTANs

May 21 09:30 UK Auctions 4.75% 2030 Conventional Gilt

May 21 10:10 France Auctions

May 21 15:30 Italy Announces details of CTZ/BTPei on 26 May

May 21 15:00 US Announces details of 2-year FRN on 27 May, plus 2/5/7 year

May 21 17:00 US Auctions 10-year TIPs

May 22 09:03 Sweden Holds bond exchange auction

May 22 10:00 Norway Details bond auction on 27 May

GBP/USD analysis forecast

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