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A new weekly trading session in the forex market is staring today with several important economic data to be released for the week September 10-14, 2018. The US economy will publish inflation rate, retail trade, industrial production and the preliminary reading of Michigan consumer sentiment, the UK economy the monthly GDP and unemployment, the Japanese economy the final GDP growth and there are two interest rate decisions from the ECB, and the BoE.

On Friday, September 7, 2017 the US Non-farm Payrolls beat the estimate coming out at 201K versus the forecast of 190k while the US Unemployment Rate remained unchanged at 3.9%. With not any market moving US economic data today but only important economic events mainly during the European Session, the US Dollar may consolidate or continue its strengthening after the release of strong labor market data. There are plenty of economic events about the UK economy, so a moderate to high volatility for the British Pound should be expected.

These are the key economic events today in the forex market, time is GMT:

European Session

UK: Industrial Production (YoY, MoM), Balance of Trade, Construction Output YoY, Manufacturing Production (YoY, MoM), GDP MoM, GDP 3-Month Avg, Russia: GDP Growth Rate YoY Fina

Time: 08:30, 13:00

The trade balance is a balance between exports and imports of goods A positive value shows trade surplus, while a negative value shows trade deficit. A trade surplus is positive for the local economy indicating capital inflows in the country, and increased demand for goods and services denominated in local currency, which may lead to the natural appreciation of the British Pound over time.

The total UK trade deficit narrowed by GBP 1.28 billion to GBP 1.86 billion in June of 2018 from an upwardly revised GBP 3.14 billion in the previous month. Exports increased 2.7 percent to GBP 52.41 billion and imports rose 0.2 percent to GBP 54.27 billion.”, Source: Trading Economics.

UK Balance of Trade

The UK economy has a trade deficit for the past 12-monts, except for only one month. Amid Brexit developments and trade agreements with the Eurozone for the past two consecutive months the trade deficit has narrowed, and this trend should be monitored in the future as the EU is among major trading partners of the UK economy.

The Gross Domestic Product is a measure of the total value of all goods and services produced by the UK economy and is considered as a broad measure of the UK economic activity. Higher than expected figures for the GDP Growth Rate, the Industrial Production, the Construction Output and the Manufacturing Production are supportive and positive for the British Pound as these changes reflect the strength of the manufacturing, industrial and construction sector. Higher economic activity usually leads to expansion in the broader economy. The yearly Industrial and Manufacturing Production figures are expected to remain unchanged at 1.1% and 1.5% respectively, the yearly Construction Output is expected to increase to 2.6% from 2.2% and the monthly GDP is expected to increase to 0.3% from 0.1%.

Any news on the Brexit other than the actual macroeconomic data can add significant volatility for the British Pound, and this volatility most probably will persist this week with the BoE interest rate decision.

For the economy of Russia an increase to the yearly GDP Growth Rate is considered positive for the Russian Ruble indicating an expansion in the broader economy. The forecast is for an increase to 1.8% from 1.3%.

American Session

US: Fed Bostic Speech, Consumer Credit Change

Time: 12:00, 19:00

The Consumer Credit Change is an amount of money that individuals borrowed, showing whether consumers can afford large expenses, which can fuel economic growth, and at the same time a high figure may indicate that the economy is overheating, and there are inflationary pressures. As Consumer Credit is a way to finance Consumer Spending, a key driver to economic growth, higher than expected figures are considered positive for the US Dollar, indicating also optimism for the economic outlook. If consumers were not confident about the prospects of the economy, employment and wages they would reduce their Consumer Credit spending. The forecast is for an increase to 12.50B US Dollars from 10.21B US Dollars.

Pacific Session

Australia: RBA Assistant Governor Bullock Speech

Time: 03:05

Any statements on financial stability, economic projections on major indicators such as inflation, economic growth, employment, may add some volatility to the Australian Dollar.

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