Yesterday the Bank of Canada made the surprise and increased its key interest rate by 0.25% from 0.75% to 1.00%, leading the USD/CAD to a 2-year low price of around 1.22. Today we have the important monetary policy decision by the ECB, and though there are no expectations for any interest rate increase, volatility in the Euro is expected as the forex market will weigh on the decision and any comments made by the ECB on the Eurozone economy.
These are the most important economic events in the forex market today to be well informed and prepared for any currency pairs fluctuations and volatility, and possible strong trend moves:
Australia Trade Balance (July)
Time: 01:30 GMT
The trade balance measures the difference of imports and exports, and has a trade surplus when exports are more than imports. This can be interpreted as greater demand for goods and services of the country which lead to the appreciation of its currency. The forecast is for a trade surplus of A$950m, higher than the previous reading of A$856m, and this in theory is positive for the Australian Dollar.
Euro-Zone Gross Domestic Product (2nd quarter final)
Time: 09:00 GMT
The Gross Domestic Product measures the overall growth of the Euro-Zone, with higher or increasing numbers being supportive for the Euro signaling economic expansion and potentially inflationary pressures. The expectation on a yearly basis is for an unchanged growth of 2.2%.
European Central Bank Rate Decision
Time: 11:45 GMT
Perhaps the economic event which has the potential to cause increased volatility for the Euro with expectations of an unchanged key interest rate at 0.0%. The forex market will focus on the language and comments made by the ECB on the rate of inflation, economic growth and the Asset Purchase Program, which is expected to decrease over time in the near future.
US Initial Jobless Claims and Continuing Claims (Weekly readings)
Time: 12:30 GMT
After the softer than expected number of non-farm payrolls last week, the weekly numbers of Initial Jobless Claims and Continuing Claims can move the US Dollar if their actual readings are lower than expected, signaling that less people filed for unemployment benefits.
US Crude Oil Inventories (Weekly reading)
Time: 15:00 GMT
The recent hurricanes Harvey and Irma certainly have a large impact on the oil prices, which have made a rally in the past days due to the shutdown of refineries, and until the supply or oil is restored to normal levels, any surprise to the weekly inventories can also move significantly the oil prices and the USD/CAD pair.
Japan Gross Domestic Product (2nd quarter final)
Time: 23:50 GMT
The Gross Domestic Product measures the total economic growth of a country, with higher readings indicating expansion and growth, which are supportive and positive for the currency of the country. The annualized forecasted reading is 2.9%, less than the previous reading of 4.0%, and any surprise can move the Yen.
