Fundamental Headlines

•    GBPUSD –  The U.K. housing market is continuing to show signs of weakness as prices declined for the fourth straight month according to Hometrak Ltd. The British Bankers’ Association reported a 31% decline in mortgage approvals from a year earlier, as banks have made it harder for buyers to get mortgages. However, approvals did slightly rebound in January to 44,288 from December’s record lows of 42,343, signaling that the recent BoE rate cuts may be beginning to impact the market. Housing troubles will start to weigh on consumer spending and the overall economy, as a rebound is still in the distant future. Discuss the topic and your trade ideas in the GBP/USD Forum.

•    EURUSD – Despite Italian retail sales increasing 0.1% in the month of December, year-over-year sales declined 0.6 percent. The monthly surprise couldn’t put a positive spin on the data as experts were expecting a 0.2% increase in the yearly number. The Italian economy has consistently lagged Eurozone brethren, as a strong Euro has weigh on it’s exports. As data from the Eurozone continues to point to a regional slowdown-tomorrow’s German IFO is expected to show confidence declining-will ECB President Jean Claude Trichet move on his hawkish stance. We may get some insight into this today as he speaks in Frankfurt. Will the ECB start moving toward a rate cut? Discuss the topic and your trade ideas in the EUR/USD Forum.

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