Credit agency Standard and Poor yesterday forecast that the entire Eurozone economy is set to contract 0.6% in 2012. The agency cut its estimate from zero growth previously as the region’s debt crisis takes its toll on recent activity. S&P forecast for 2013 that the Eurozone economy would grow only 0.4% was also revised from 1%. There is a 40% chance of a Eurozone double-dip recession in 2013 according to the credit agency.

Credit agency Standard and Poor yesterday forecast that the entire Eurozone economy is set to contract 0.6% in 2012. The agency cut its estimate from zero growth previously as the region’s debt crisis takes its toll on recent activity. S&P forecast for 2013 that the Eurozone economy would grow only 0.4% was also revised from 1%. There is a 40% chance of a Eurozone double-dip recession in 2013 according to the credit agency.

In the US, the Dollar fell against most of its major counterparts yesterday amid speculation that Federal Reserve policy makers will signal additional stimulus when they conclude a two-day meeting that starts today.

Fed Chairman Ben S. Bernanke said this month policy makers are “looking for ways to address the weakness in the economy, should more action be needed to promote a sustained recovery in the labour market.” The central bank did not like the idea of introducing a third round of asset purchases at its June meeting, however this may change this time round as global growth weighs.

In the UK, mortgage approvals and lending slumped in June, raising concerns of a broader economic weakness. Consumer lending such as credit card borrowing held up well but house purchase activity declined to its lowest in one and a half years. Money supply figures showed their biggest annual drop since records began in 1983 reducing the amount of Sterling in circulation.

Today’s Fundamentals.

07.55 EUR German Unemployment Change (Jul) – This is predicted to fall from the previous level 7K, which will be a positive for EUR. Unemployment Rate.

09.00 EUR EMU Consumer Price Index (YoY) (Jul) – Thisis a significant way to measure changes in purchasing trends and inflation in the Eurozone is predicted to stay at the same level 2.4%.

09.00 EUR EMU Unemployment Rate (Jun) – Thisis predicted to increase from the previous level 11.1% by 0.1%.

12.30 USD United States Personal Income (MoM) (Jun) – This is predicted to increase from the previous position of 0.2%.

12.30 USD United States Core Personal Consumption Expenditure – Price Index (MoM) (Jun) – Thisis predicted to increase from the previous position of 0.1%.

12.30 USD United States Core Personal Consumption Expenditure – Prices Index (YoY) (Jun) – Thisis predicted to stay at the same market level 1.8%.

12.30 USD United States Personal Consumption Expenditure – Prices Index (YoY) (Jun) – Thisis predicted to stay at the same market level 1.5%.

12.30 USD United States Personal Spending (Jun) – Thisis predicted to stay at the same market level 0.1%.

14.00 USD United States Consumer Confidence (Jul) –Thisis predicted to fall from the previous position 62.0.

To get a live exchange rate login to RationalFX now, or call +44 (0)20 7220 8181