Forex - GBP/USD weekly outlook: December 6-10

Published 12/05/2010, 10:11 AM
GBP/USD
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Investing.com – Last week saw the pound post its first weekly gain against the U.S. dollar in four weeks, after official data showed U.S. employers added fewer jobs than forecast last month.

GBP/USD hit 1.5483 on Tuesday, the pair’s lowest since September 15; the pair subsequently consolidated at 1.5772 by close of trade on Friday, surging 1.14% over the week.

Cable is likely to find support at 1.5580, last Friday’s low and resistance at 1.5964, the high of November 23.

On Friday, Labor Department data showed U.S. non-farm payrolls rose 39,000 last month, much weaker than expectations for 140,000 new jobs. The unemployment rate also increased to 9.8%, close to a 26-year high.

Also last week, data showed that U.K. manufacturing growth unexpectedly accelerated to the fastest pace in 16 years in November as export orders climbed, while a separate report showed that U.K. services sector activity eased in November, in line with expectations.

Meanwhile, U.K. Chancellor of the Exchequer George Osborne on Tuesday defended Britain’s GBP3.25 billion bilateral loan to Ireland, saying was not a “blank check” for other European countries.

He also denied that a banking crisis in Ireland would have led to a secondary crisis in Britain. “There’s no indication that I’ve received that that’s the case,” he said.

Next week, the U.S. is to release key weekly data on initial jobless claims, as well as a report on the country’s trade balance and preliminary data on consumer sentiment. Meanwhile, Federal Reserve Chairman, Ben Bernanke, is to appear in a televised interview.

In the U.K., the Bank of England is to announce its benchmark interest rate. The country is also due to release data on manufacturing production, house prices and inflation.

Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.

Monday, December 6


In the U.S., Federal Reserve Chairman, Ben Bernanke is due to speak about monetary policy in an interview to be aired on CBS. The interview was given a week earlier.

Tuesday, December 7

The U.S. is to publish the IBD/TIPP index of economic optimism while later in the day the country is to publish official data on consumer credit.

The U.K. is to publish official data on manufacturing and industrial production, as well as industry data on retail sales. Later in the day, the National Institute of Economic and Social Research is to publish its estimate of monthly gross domestic product, in an effort to predict the quarterly government data.

Wednesday, December 8


The U.K. is to publish industry data on industrial order expectations, an important indicator of economic health as well as an industry report on inflation by the British Retail Consortium. The U.S. is to publish official data on crude oil inventories.

Thursday, December 9

The U.S. is to release key weekly data on initial jobless claims, a leading indicator of economic health, as well as reports on wholesale inventories and natural gas storage.

Meanwhile, the U.K. is to release official data on its trade balance, while the Bank of England is to announce its benchmark interest rate. The BoE will also release its Monetary Policy Committee rate statement, which contains the outcome of their vote on interest rates and other policy measures.

Friday, December 10


The U.K. is to release official data on producer price inflation input, a leading indicator of economic growth.

The U.S. is to round up the week with official data on its trade balance, federal budget balance and import prices. The country is also set to publish preliminary data from the University of Michigan on consumer sentiment and inflation expectations.

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