On Tuesday 04-07-09 at 4:30 AM ET, the GBP Industrial Production (MoM) report will be released for the month of February.
This report was also released with GBP Industrial Production (YoY) and GBP Manufacturing Production (MoM) (YoY).
The previous GBP Industrial Production report came out on Tuesday 03-10-09 at 4:30 AM ET.
The GBP Industrial Production report released in March, for the month of January, was set up as follows:
Previous Report: -1.7% – revised to -1.5%.
Economists Forecast: -1.2% – not an improvement for the British economy.
The actual report: -2.6% – not good for the British economy.
The “revision” could have an had an effect on the currency market – but I have not seen it yet.
I monitored 4 currency pairs during the March GBP Industrial Production report and here is what happened:
EUR/GBP – moved up about 20 PIPS in 2 minutes – right direction
moved down about 57 PIPS in 35 minutes – wrong direction
GBP/CHF – moved down about 37 PIPS in 2 minutes – right direction
moved up about 107 PIPS in 34 minutes – wrong direction
GBP/JPY - moved down about 30 PIPS in 2 minutes – right direction
moved up about 76 PIPS in 35 minutes – wrong direction
GBP/USD – moved down about 40 PIPS in 2 minutes – right direction
moved up about 86 PIPS in 35 minutes – wrong direction
The GBP Industrial Production for this month’s release ( a report on February report) has a “forecast” of -1.1%, an increase in the Industrial Production for that month.
If the “actual” GBP Industrial Production report comes out less or more than the “forecast” by a large amount, say 0.2% or more, this would be a huge surprise for FOREX traders and the market may move considerably in the following minutes of the report.
So, let’s set this up:
The March previous= -2.6%
The economists forecast= -1.1%
If the “actual” report comes out -0.6% or more, this will be good for the GBP, and a big surprise for traders. Any currency pair which includes the GBP may move in favor of the GBP.
However, if the “actual” report comes out at -1.6% or less, this would be bad for the GBP and again, a big surprise for traders. Any currency pair which includes the GBP may move against the GBP.
The probabilities set forth above are assuming no unpredictable events are taking place at the same time.
Speeches on the economy by government officials, or a situation somewhere in the world that could have an impact on the British economy – could adversely affect the market.
Sometime after the end of the GBP Industrial Production report I will post a results. So, check back!
Friday 04-07-09:
Here are the results of GBP Industrial Production report:
The GBP Industrial Production “actual” report came out at -0.9%, which was good for the British economy, but the market felt differently.
Here is how it affected the 4 currency pairs I follow:
EUR/GBP – moved in a down/up range about 12 PIPS for 27 minutes
GBP/CHF – moved up about 30 PIPS in 3 minutes – right direction
then down about 30 PIPS in 6 minutes – wrong direction
moved up about 35 PIPS in 10 minutes – right direction
then down about 45 PIPS in 11 minutes – wrong direction
GBP/JPY – moved up about 20 PIPS 1st 3 minutes – right direction
then moved down about 125 PIPS in 43 minutes – wrong direction
GBP/USD – moved up about 20 PIPS 1st 3 minutes – right direction
then moved down about 120 PIPS in 43 minutes – wrong direction
Not much opportunity for scalping with the 2 currency pairs EUR/GBP and GBP/CHF.
But, it looks like the market felt that it was a good idea to go against the small improvement to the British economy and “short” the GBP in favor of the USD and JPY.
