Last week the British Pound failed to avoid the impact of the eurozone crisis. This week the UK is to release 2 major indicators - Manufacturing PMI and Construction PMI. The Bank of England reports a sharp slowdown in the UK economic recovery amid poor GDP forecast for Q4 2011.
The US Dollar keeps benefiting from the difficulties in Europe as it is currently seen as a safe haven asset. Non-Farm Payrolls are the economic report of the week, which is always attended by high volatility.
GBPUSD started last week with a decline from 1.5794, the week’s high, and finished the trading week near the week’s low at 1.5422. Therefore, GBPUSD declined by 372 points. The option barrier 1.5721 was easily overcome. However, t he first test of the next barrier (1.5635) failed. The 2nd test was a success.
Let’s look at this week’s economic calendar
Nov 29th (GMT)
06:00 GBP Nationwide HPI
15:00 USD CB Consumer Confidence
Nov 30th (GMT)
13:15 USD ADP Non-Farm Employment Change
15:00 USD Pending Home Sales
Dec 1st (GMT)
1st-7th GBP Halifax HPI m/m
09:30 GBP Manufacturing PMI
13:30 USD Unemployment Claims
15:00 USD ISM Manufacturing PMI
Dec 2nd (GMT)
09:30 GBP Construction PMI
13:30 USD Non-Farm Employment Change
13:30 USD Unemployment Rate
The UK:
Nationwide HPI: Last week the prices gained 0.4%, this time they are expected to lose 0.1%.
Halifax HPI m/m: The exact time of the release is unknown. Last month the index grew by 1.2%.
Manufacturing PMI: In October it fell below 50 down to 47.4. It suggests a cutback in production. In November the index is expected to decline down to 47.2. Only a recovery above 50.0 will help the British Pound. The release is attended by high volatility.
Construction PMI: The UK’s construction sector showed reassuring stats in October. The index grew up to 53.9. In November it is expected to see a slight decline. But it will most likely stay above the crucial level 50.0. The release is also attended by high volatility.
The US:
CB Consumer Confidence: Last month the index declined, thus suggesting pessimism over the current financial situation in the USA.
ADP Non-Farm Employment Change: The indicator is expected to grow further up to 131.
Pending Home Sales: The amount of US homes under construction unexpectedly declined by 4.6% in September despite low mortgage rates. It is probably connected with high unemployment and reduced bank loans.
Unemployment Claims: They are expected to decline down to 390K.
ISM Manufacturing PMI: As long as the indicator is still above the 50.0 level, we can conclude that the US economy is still recovering.
Non-Farm Employment Change: The index keeps reassuring investors. Last month it increased by 80K new jobs. The US labor market seems to be recovering, which is a positive sign for the country’s economy. This time the index is expected to see a 119K increase.
Unemployment Rate:
The US rate of unemployment declined down to the 6-month low (9.0%), which indicates a recovery in the US labor market as investors are getting less concerned about the possibility of a double-dip recession. However, the pace of recovery needs some acceleration in order to see cardinal changes.
The closest levels of resistance are 1.5635 and 1.5721, the closest levels of support are 1.5474 and 1.5388.
Provided by the Department of Options,
