Following the report on the German CPI that was issued on Friday 28 June, the European Central Bank is set to release its own evaluation on the state of the overall Eurozone economic picture today at 900 UTC, Monday 1 July, 2013.

Analysts believe that due to ongoing concerns over the stability of the Eurozone, the ECB is unlikely to change its current interest rates, which now stand at .50%. Should they decide to do so, it may add unwanted pressure on attempts at recovery. As there are concerns that levels of inflation may be slightly on the rise, traders may expect there to be some volatility with the Euro in its pairings against other currencies following the report.

Dollar Shows Strong Gains Ahead of Manufacturing Report

The USD is reported to have made significant gains against the Yen and other currencies in a string of strong trading days leading up to the much awaited Institute for Supply Management’s factory index report. The report detailing levels of growth for the month of June is set to be issued today Monday 1 July, 2013.

Analysts believe that the ISM’s report is likely to show a significant recovery from the month of May, thus moving US manufacturing into the black in terms of positive growth. Many analysts have pointed to recent optimistic statements coming out of the Federal Reserve regarding their forecast for the economy as a sign of confidence in the strength of the USD
Analysts note that the USD displayed some of its strongest showings against both the Yen and the Euro since the beginning of the month. Traders are likely to see a rise in the strength of the USD in its currency pairings over the coming days.

Rising Housing Prices Unlikely to Influence GBP

Despite a consistent rise in housing prices in the UK over the course of the past five months of the year, analysts do not believe that there will be any significant effect felt on the value of the GBP.

Currently the GBP is continuing its low levels of trading against the USD and the Euro, both of which have experienced respectable rates of growth over the month of June 2013.

Reports that the Bank of England may decide to continue its policy of added stimulus in the economic recovery policy could point to decreased levels of confidence by investors. As such, analysts believe that the GBP is likely to fare weaker in its pairings against the USD and the Euro.