Fundamental Headlines

•    GBPUSD –  U.K. GDP rose 0.6% in the fourth quarter of 2007, which was the slowest pace in more than a year. Growth was weighed down by slower consumer spending which printed at 0.2% percent, a third of the 0.6% forecasted. Tight credit markets and a housing downturn are pulling down the economy and recent BoE rate cuts may not be enough to soften the fall. However, the BoE is reluctant to cut further as record energy prices are stoking inflation concerns. Discuss the topic and your trade ideas in the GBP/USD Forum.

•    EURUSD – German import prices increased more than expected in January printing 0.8% versus an expected 0.3%, pushing  the year-over year rate to 5.2%-the highest since August 2006. The increase is not entirely surprising as rising oil prices have inflated costs worldwide. In a separate report the GfK consumer confidence survey unexpectedly held steady as income expectations improved., but economic outlook and willingness to buy declined. The overall news will  not comfort the ECB as inflationary pressures are increasing and preventing them from cutting rates in the near term. Discuss the topic and your trade ideas in the EUR/USD Forum.

Podcast by Terri Belkas, Currency Analyst,  DailyFX.com, tbelkas@dailyfx.com