The Foreign Exchange or Forex calendar is an informative event based economic calendar which traders utilize to keep track of upcoming international financial news. An FX calendar has vital information for past and future economic events of various countries and is often clue the savvy trader in on possible price fluctuations of selected currency pairs. These calendars are updated regularly and are widely accessible online. A number of websites provide a valuable service of informing the trader about significant economic developments around the globe. These include economic news released by the central bank of the country, government news, and non-government market related information such as economic reports and stock exchanges. Additionally, these websites offer free daily updates on major financial indexes including: The Dow Jones, The Nikkei, and The FTSE100.
The foreign exchange market keeps tabs on every economic event from the latest U.S.D. Office of the Secretary of State, the release of the official inflation figures, release of quarterly GDP figures, release of consumer inflation figures, and other announcements from government agencies. This wide access to news is beneficial to more investors. It allows traders and investors to determine market signals regarding various economic indicators.
A number of factors affect the foreign currency trading market. Economic calendar data is essential to identify and trade with potential trading opportunities as well as identify market trends. A good forex economic calendar provides easy access to market information on key economic indicators. It also provides information on currency trading opportunities, facilitating better decision making when it comes to trading currencies.
Economic calendars are important for tools in identifying market signals, particularly economic release. Economic releases serve as signals of interest rates, interest rate cuts, rates rise, unemployment figures, manufacturing surveys, and Consumer Confidence Index (CCI) readings. Economic release data is used by most forex traders and investors to determine currency prices movements. Understanding economic release data provides traders and investors with a better understanding of economic conditions in different countries.
The data collected during an economic calendar week is used to analyze upcoming economic news and events. Forex traders look at this information to anticipate any changes in the market. The data gathered during the week gives a trader or investor an insight as to what the central bank will do next in terms of its monetary policy approach. When the central bank decides to change its policy, the effect of that policy change on the economy can be large. Economic news and events such as these lead to the release of Economic Calendars every day.
Economic Calendar data helps traders and investors to evaluate the movements of the exchange rate, determining the direction of the market. It provides the necessary tools for them to forecast the markets and make informed decisions regarding currency trades and transactions. Having knowledge of the current economic calendar in a particular country allows traders and investors to gauge the movements of the national currency that they are trading. For example, if the Australian dollar weakens against the US dollar, traders and investors can make an educated guess as to the direction that the exchange rate will take, especially if they are already using the AUS USD indicator to guide them.
Another important use of the economic calendar is to track the interest rates of various interest rates. By monitoring the interest rates, traders and investors can estimate how the government will deal with any changes in the base interest rate. Changes in the base interest rate may cause increases or decreases in trading currencies, affecting the profitability of their currency trading activities. Knowing when the government will adjust the interest rates is important to successful currency trading.
The economic calendar has several other uses aside from providing indicators of economic activity. For instance, it is widely used in predicting elections around the world. Candidates vie for election based on their performance in economic reports released on the previous month. The economic calendar has been a tool of prediction for thousands of years and is proven to be accurate most of the time. Understanding this very basic tool can give you an insight into how the political arena is conducted.