The fact of the matter is that currency does not decline or rise randomly. There are typically a number of factors that contribute to the rise and fall. Consumer confidence is a key indicator in how well currencies perform, since consumer confidence is typically based on the strength of the economy. In order to understand and predict market changes, investors will need to be up to date with the economic information that is released. The best way to do this is to use the Forex economic calendar tool. Economic news releases can impact not only short-term trading, but long-term trading as well. The economic calendar can be extremely beneficial in helping investors to make trades that will be wise and profitable. The following are the key types of economic data that are released through the Forex economic calendar:
1. Unemployment/Payroll Data
The news that is released is not nearly as important as whether or not the news is expected or has come as a surprise. Strong job creation is a positive indicator of economic strength. The unemployment rate and the health of the labor market can help analysts to engage not only the strength of the warta ekonomi, but also to predict the strength of the economy in future quarters. The economic calendar will keep investors up to date with relevant unemployment data.
2. Discount Rate
The Discount rate is set by the Federal Open Market. This rate is the rate that the Federal Reserve charges participating banks for overnight loans that are taken out. Meetings are held 8 times per year, and each time the rate can fluctuate. The economic calendar is a vital tool in knowing these rates as soon as they hit the wires.
3. Consumer Price Index
The consumer price index (CPI) gauges inflation, because it measures the price of consumer goods. When prices are high it could be an indicator that the economy is losing steam. However, when prices are high central banks sometimes raise interest rates to counter inflation. If rates are raised currency markets are more likely to respond positively. If no action is taken, they will be more likely to respond negatively. The Forex economic calendar can provide investors with hourly information on the consumer price index.
News on retail sales, trade balance, and other vital information can be obtained from the economic calendar as well. Investors that use the calendar will find that there will be a lot less risk involved with their trades, since they will have a wealth of accurate information to effectively plan their trading strategies.