The economic calendar today in the forex market has important events related mainly to the economies of the UK and US, with the GBP/USD currency pair probably experiencing moderate to high volatility, and the US Dollar preparing for the first major trend set by the forthcoming non-farm payrolls on Friday 5th January.
These are the main economic events to focus on today as they can move the market:
European Session
- UK Nationwide Housing Prices, Spain Markit Services PMI, Italy Markit/ADACI Services PMI, UK Mortgage Approvals, BoE Consumer Credit, Markit/CIPS Services UK PMI, UK Mortgage Lending
Time: 07:00 GMT, 08:15 GMT, 08:45 GMT, 09:30 GMT
Higher than expected or rising figures for Markit Services PMI sectors, will signal expansion and increased economic and business activity, which is positive and supportive for the mentioned countries and their currencies, i.e. the Euro and the British Pound. The forecasts for all three countries, Spain, Italy and UK are for an increase in the figures of their Markit Services PMI Indexes. For the economy of UK, there are important fundamental news regarding the state of the housing market, with the release of mortgage approvals and lending, and mainly The Nationwide Housing Price Index, which tracks the change of the houses prices, and reflects also inflationary pressures as well.
Higher readings for the mortgage approvals, lending, and the change of houses prices are considered positive for the British economy and the British Pound, reflecting a strong housing market, which is highly correlated with the overall state of the economy. Same applies to consumer credit in the UK, as increased figures are considered positive as they can increase consumer spending on goods and services, contributing to higher economic growth over time. The consumer credit forecast is for an increase with a reading of 1.5 Billion Pounds, higher than the previous figure of 1.451 Billion Pounds.
American Session
- US ADP Employment Change, US Markit Services PMI Final and Markit Composite PMI Final, EIA Crude Oil Stocks Change and Gasoline Stocks Change, Fed Bullard Speech
Time: 13:15 GMT, 14:45 GMT, 16:00 GMT, 18:30 GMT
ADP Employment Change is a measure that indicates the exact number of people who have joined or left the workforce during a set period of time, usually a month. Positive numbers indicate that more people have joined the workforce during the reported period than left, while negative numbers indicate a contraction in employment. Higher than expected or rising figures are positive and supportive for the US Dollar, and same applies for the readings of the PMI Indexes, the services sector and the Composite PMI Index which indicate the state of both manufacturing and non-manufacturing sectors.
The forecasts are for a decline of the Services and the Composite PMI Indexes, which is not positive for the US Dollar, indicating a contraction for the services manufacturing and non-manufacturing sectors. Later on the release of the weekly crude oil stocks change can influence the crude oil prices and the USD/CAD currency pair, if there are large positive or negative surprises for the actual versus expected readings. For example if the increase in crude inventories is more than expected, this implies weaker demand and is considered negative for crude prices. Crude oil prices are currently trading above the $60 per barrel, and global output will be a key fundamental driver for their future price.
