Several important economic events in the forex today have the potential for increased price action and volatility for many currencies, as there will releases about the state of various sectors for the economies of Germany, Eurozone, and the US, the unemployment rate in UK and the inflation rate for New Zealand. The Japanese Yen, though it has not any significant economic events for today, may move as the traders and participants in the forex market will evaluate the unchanged monetary policy by the BoJ and its effects on economic conditions for Japan.
These are the main economic events in the forex market for today:
European Session
- France Markit Manufacturing PMI and Markit Services PMI, Germany Markit Manufacturing PMI and Markit Services PMI, Eurozone Markit Manufacturing PMI and Services PMI
Time: 08:00 GMT, 08:30 GMT, 09:00 GMT
The Markit Indexes measure the state of various sectors, such as the manufacturing and services sector, with levels above 50 signaling an expansion of the industry, increasing economic and business activity and therefore being supportive and positive for the local economies and the currencies. For Germany and the Eurozone the forecasts are for marginal lower readings, which may weigh as either neutral or even negatively for the Euro.
- UK Unemployment Rate, Claimant Count Change, Average Earnings Including Bonus, France Unemployment Benefit Claims
Time: 09:30 GMT, 17:00 GMT
Claimant Count Change measures the change in the number of unemployed people in the U.K. during the reported month. Rising or higher than expected readings indicate weakness in the labor market, as does rising figures for the unemployment rate. The forecast is for an unchanged reading of the unemployment in UK, at 4.3%, and also a lower reading for the claimant count change, at 5.4K versus 5.9K, which is positive for the labor market in UK and the British Pound. Also lower than expected or declining figures for the unemployment benefit claims in France are positive for the economy of France and the Euro, signaling a robust labor market.
American Session
- US Markit Manufacturing PMI Flash and Services PMI, Composite PMI, Existing Home Sales, EIA Crude Oil Stocks Change and Gasoline Stocks Change
Time: 14:45 GMT, 15:00 GMT, 15:30 GMT
The forecasts for the relevant Markit PMI readings for the US economy and various sectors are mixed, with an increase expected in economic activity only for the services sector, and a marginal decline for the manufacturing sector, while the composite PMI reading, which indicates the well-being of both manufacturing and non-manufacturing sectors is also expected to decline with a reading of 53.5, lower than the previous reading of 54.1.
This will indicate a slower yet positive growth, which may have a neutral to negative effect on the US Dollar. Also the forecast for the existing home sales is for a decline, which is negative for the housing market and the US Dollar, but trends over time should be monitored to get insights and analysis about the state of the US housing market. These economic events may have as result a possible selling pressure for the US Dollar, low to moderate upon their release.
The Crude Oil Stocks Change is a weekly report about the inventories of crude oil. There is an inverse relationship between the number of inventories reported and the demand of the crude oil. If there is an increase of the crude oil inventories, which is more than the expectation, then there is weak demand for oil, and this should be interpreted as negative for the oil prices. Large surprises, either positive or negative versus the actual readings can move significantly the oil prices.
Pacific Session
- New Zealand Inflation Rate QoQ
Time: 21:45 GMT
Any rising or higher than expected figures for the inflation rate on a quarterly basis indicate the presence of inflationary pressures in the economy, and in general are positive for the New Zealand Dollar, increasing the odds of future interest rates by the central bank of New Zealand to fight inflation.
Low levels of inflation do not pose any economic threat though and are considered neutral for the local currency, as they tend to have minor impact on the monetary policy. This should be the case for the New Zealand as the forecast is for a reading of inflation rate of 0.4% on a quarterly basis, lower than the previous reading of 0.5%. This will signal not any severe inflationary pressures, as on the contrary inflation is expected to decline and may have a neutral or negative effect on the New Zealand Dollar.
