Source: ForexYard
On this coming Friday the German Preliminary GDP figures are scheduled to be published at 6:00 GMT. The data release is a measure of the alteration in the value of services and goods that are produced by the German economy in each quarter. In most cases an equal or better than forecasted result produces a bullish EUR vs. its major currency pairs. This data release is one of the most important and extensive primary measures of Germany’s economic activity and health. It is also a prelude to the Final GDP figures that are set to be released 10 days from Friday.
Most analysts forecast that the Preliminary GDP figures of the 1st quarter will be about -3% from the 4th quarter of 2008. This is significantly direr than the previous figures of -2.1%. This so as the German economy continues to deteriorate as analysts fear unemployment to spiral to 5 million in the near future. As of now, the EUR/USD rate is relatively unchanged today at 1.3568, despite rising to over 1.3700 in yesterday’s trading on Wednesday. The EUR/GBP rate is relatively unchanged too at 0.8970 as traders wait till Friday.
If the GDP figures are the same or are worse than the forecasted -3% figure than this could lead to a bearish EUR going into end of week trading. Therefore, the EUR/USD rate could go below 1.3400, whilst the EUR/GBP cross could fall below 0.8850. However, if the results are less severe than analysts fear, then there could be a very bullish EUR going into next week’s trading. Therefore, the EUR could jump about 150 pips against the USD, GBP, and JPY respectively. In the meantime, traders are advised to pay close attention to news events coming out of Britain and the U.S., such as U.S. Unemployment Claims today at 12.30 GMT.
Forex Market Analysis provided by ForexYard.
© 2006 by FxYard Ltd
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