EUR/CHF Fundamental Analysis May 28, 2012, Forecast

Analysis and Recommendations:

The EUR/CHF fell back to its long term trading range after as isolated bump yesterday. The pair are now trading at 1.2009.

Comments by Italian PM Mario Monti were being fingered as having provided the motivation for a lift to the risk trade in that he stated that the majority across the EU support joint Eurobond issues and that Germany’s opposition could be overcome.  It seems the market was a little too quick to inject some optimism here as equities have since turned negative again and probably for good reason.  For one thing, Monti’s account of the EU Summit sharply differs from that provided earlier by Luxembourg PM Jean-Claude Juncker who said that eurobonds have no support in the German influenced regions as an offset to support within France.  For another, German Chancellor Angela Merkel reiterated opposition to eurobonds and this stance has been supported by the opposition.  What markets are latching on to is that her government has, however, agreed to study a “redemption fund” proposal.

With little in the way of eco data or encouragement in the EU, this pair will remain range bound for the near future.

FxEmpire 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.

Economic Data for May 25, 2012 actual v. forecast

Date

 

Currency

 

 

 

Event

Actual

 

Forecast

 

Previous

 

 

May 25

 

JPY

 

 

 

Tokyo Core CPI (YoY) 

-0.8%

 

-0.6% 

 

-0.5% 

 

 

 

 

EUR

 

 

 

GfK German Consumer Climate 

5.7

 

5.6 

 

5.7 

   

 

 

CHF

 

 

 

Employment Level 

4.05M

 

4.02M 

 

4.04M 

 

 

 

 

PLN

 

 

 

Polish Unemployment Rate 

12.90%

 

12.80% 

 

13.30% 

 

 

 

 

MXN

 

 

 

Mexican Unemployment Rate 

4.9%

 

4.9% 

 

4.6% 

 

 

 

 

MXN

 

 

 

Mexican Trade Balance 

0.560B

 

1.000B 

 

1.575B 

 

 

 

Upcoming Economic Events that affect the CHF, EUR, GBP and USD

Date

Time

Currency

 

Previous

May 28

28th-31st

GBP

Nationwide HPI m/m

-0.2%

May 29

All Day

EUR

German Prelim CPI m/m

0.2%

10:00

GBP

CBI Realized Sales

-6

13:00

USD

S&P/CS Composite-20 HPI y/y

-3.5%

14:00

USD

CB Consumer Confidence

69.2

May 30

7:00

CHF

KOF Economic Barometer

0.40

8:00

EUR

M3 Money Supply y/y

3.2%

8:30

GBP

Net Lending to Individuals m/m

1.4B

14:00

USD

Pending Home Sales m/m

4.1%

23:01

GBP

GfK Consumer Confidence

-31

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