On Tuesday 04-21-09 at 4:30 AM ET, the GBP Consumer Price Index YoY report will be released for the month of March.
This report was also released with GBP Core Consumer Price Index YoY report and retail price index reports.
The previous GBP Consumer Price Index YoY report came out on Tuesday 03-24-09 at 4:30 AM ET.
The GBP Consumer Price Index YoY report released in March, for the month of February, was set up as follows:
Previous Report: 3.0% – not revised.
Economists Forecast: 2.6% – not an improvement for the British economy.
The actual report: 3.2% – Good for the British economy.
The difference between the “actual” report and the “forecast” was 0.6%, good enough for a profitable trade.
I monitored 4 currency pairs during the February GBP Consumer Price Index YoY report in March and here is what happened:
EUR/GBP – moved down about 48 PIPS in 39 minutes – right direction
GBP/CHF – moved up about 90 PIPS in 31 minutes – right direction
GBP/JPY - moved up about 70 PIPS in 4 minutes – right direction
moved down about 120 PIPS in 56 minutes – wrong direction
GBP/USD – moved up about 65 PIPS in 4 minutes – right direction
moved down about 110 PIPS in 56 minutes – wrong direction
There was some good market movement and some “scalping” profits were possible.
The GBP Consumer Price Index YoY report for this month’s release ( a report on March GBP CPI report) has a “forecast” of 2.9%, a decrease in the Consumer Price Index for that month.
If the “actual” GBP Consumer Price Index YoY 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= 3.2%
The economists forecast= 2.9%
If the “actual” report comes out 3.1% 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 2.7% 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 Consumer Price Index YoY report I will post the results. So, check back!
Tuesday 04-28-09:
Here are the results of GBP Consumer Price Index YoY report :
Previous Report: 3.2% – not revised.
Economists Forecast: 2.9% – not an improvement for the British economy.
The actual report: 2.9% – as forecast.
The GBP CPI “actual” report came out at 2.9%, which was not good for the British economy, the market felt that way as well, but the forecast was already figured in.
At 5:00 AM the EUR German ZEW Report was scheduled for release, the market may have been getting ready for that and this may have had some affect.
Here is how it affected the 4 currency pairs I follow:
EUR/GBP – moved down about 20 PIPS in 8 minutes
moved up about 25 PIPS in 16 minutes
GBP/CHF – moved up about 30 PIPS in 8 minutes
GBP/JPY - moved up about 24 PIPS in 8 minutes
GBP/USD – moved up about 19 PIPS in 7 minutes
I think that when the “actual” report comes out as “forecast”, and there is another important report coming out real soon, the traders “mark their time” until the results for the later report is evaluated.
