With all of the resources readily available, it can get overwhelming, too. There seems to be something new and happening every minute, which can lead to information overload. But with so much to keep up with, you might miss out on some events or news that may prove to be crucial! Thankfully, The Forex Factory economic calendar is here to ease the burden for every trader who wants to perfect their craft and keep up with the latest forex news.
What is the Forex Factory calendar?
The Forex Factory calendar is one of the most useful tools of the trade. It is user-friendly and accurate, helping you stay on top of current Forex events. It is definitely one of the things you should have in your arsenal!
In a nutshell, the Forex Factory calendar will show you the scheduled news events for the week. It streamlines and arranges these news bites, ranking them from low to high impact. You can even personalise and input your time zone so that you will be able to view news events based on your local time.
With all of the amazing, user-friendly features that this forex news calendar has, it is inevitable you will hear get used to it being mentioned in the industry. Mastering this tool will help you make the most out of your investment, through careful considerations based on this application.
The forex factory calendar It is undoubtedly one of the most advanced and understandable economic calendars out there. If you’re a beginner, you won’t be daunted or put off by numbers or unfamiliar words. It has been designed to be accessible to every kind of trader from every experience and skill level.
What sets the Forex Factory calendar apart?
If you are keen on finding out just what makes Forex Factory calendar so special, then we have a lot of bases to cover.
Apart from displaying the dates of the key economic data featured, the Forex Factory calendar also contains data of impact ratings, an adjustable time zone, real-time data release, real-time links to event sources, and economic charts.
These pieces of information are neatly organised on a comprehensive viewing chart that allows for you to set your sights on what you want to see by setting your preferred relevant filters. Through this, you will be able to access only the things that will be relevant to you.
Having these at your fingertips is definitely useful and provides a great level of insight as you make your Forex trading decisions! You will be able to know exactly how to best position your trade, based on these data releases.
The Forex Factory calendar is a cornerstone of useful information, but it does not end there. Its strongest backbone is its team of highly trained experts. These professionals are consistently keeping tabs and updating relevant information at regular intervals.
You know you will be in good hands, since these trained and experienced financial economists are working hard to keep the calendar updated and give you the freshest, most useful pieces of information and forex trading nuggets.
Forex Factory Economic calendar: Accuracy and Reliability in One
There is a reason why the Forex Factory calendar has gained and retained the trust of many traders over the years. It is because of the accurate news and information that they deliver, aiding in the decision-making of many traders.
The fact that it is developed and maintained by some of the most experienced Forex professionals says a lot about the quality it puts out. However, its reliability is one of its strongest suits as well. In fact, many other Forex trading sites adopt the Forex Factory economic calendar and incorporate it into their own internal calendars!
How do you use the Forex Factory calendar?
If you have set your sights on using the Forex Factory calendar to take your Forex trading skills further, then we have got you covered with this handy guide. All you need to do is follow our step-by-step guide and you will master this tool in no time!
1. Open the Forex Factory calendar.
Thankfully enough, you don’t need to download anything in order to use this tool. The first thing that you need to get done is to pull up the site for Forex Factory calendar.
2. Set up your own time zone.
As we mentioned earlier in this article, one of the greatest strengths of the Forex Factory calendar is that you can tailor fit the news events to display according to your own time zone.
All you have to do to get this done is to hover your mouse over the upper right hand side of the screen. Click the time stamp and set it up to your own preference. This will then configure the news events to appear in compliance with your local time.
Don’t brush aside this part so easily! This is definitely one of the first things you should do, as it is crucial for you to set the right time for the platform to present the correct time for each event. Don’t worry; You won’t need to do this every time as you can save settings and not have to worry about it on your next visit.
Make sure that you set it to the correct time to get the best results.
3. Set up your event filter.
While it may be nice to get as much information as possible, it will probably be better for you to get the data you need right off the bat. Instead of scrolling through news events that are irrelevant to you, you can set up an event filter instead.
The event filter of the Forex Factory calendar allows you to restrict what you see to only the news and currencies of your preference. you will need to utilise this if you are a trader who is only interested in certain currency pairs.
To get the event filter set up, just scroll up to the “filter’ icon on the upper right-hand corner. SA list will then show up, and you will be able to filter data to currency, event type, and expected impact.
4, Determine the time frame that you want to see.
With your time zone set up, and your filter up and running, it’s time to select the specific time frame. The time frame we are referring to in this context is the span of time that will be featured on the Forex Factory calendar.
There is a mini calendar on the left side of the screen. From here, you will be able to set any time frame.
5. Go beyond the surface of the Forex Factory calendar.
There really is more than meets the eye here, and this tool is definitely a testament to that. Once you know the basic ins-and-outs of this platform, you will be able to go beyond the surface content and see additional information!
We recommend that you tread this carefully though. It is all too easy to get sucked in and lose sight of how the news event factors into Forex trading.
Watch this video: Trading Events on the Forex Factory Calendar – How to Trade the ECB Interest Rate Decision (21m 54s)
Extensive knowledge on Forex Factory trading is helpful to Forex traders from all walks of life.
Knowing how to use the Forex Factory calendar, and knowing how to use it to your advantage are two very different things. With the step-by-step guide we have provided above, you will surely be able to master the forex factory economic calendar in no time.
The Forex Factory calendar is a no-frills site that has been trusted for many years. If you embrace it and utilise it to your advantage, you will be able to strategically position your trades so that you can minimise the risk and maximise potential!
In short, the Forex Factory Calendar is one of the easiest and most comprehensive economic calendars available to traders. It shows you dates, times, and the impact that each event is likely to have on the markets. For example, the Non-Farm Payroll report is a high-impact event in the FX market as the shift in the dollar can affect a multitude of other currencies, commodities, and indices.
Knowing about these events and when they’ll occur is vital to the success of any trader’s account, and will determine how well they will perform as a professional trader.
Forex Factory News Events: High Impact/Red Flag Events
Understanding the high impact Forex Factory news events is critical to your success as a forex trader.
It’s this understanding that separates the average traders from the exceptional traders. Below we’ll go through the various high-impact events, outlining what they’re called, what any acronyms stand for, any other names for the events, the typical release date (if applicable), and what they mean for the markets.
Want to jump to a specific currency? Click one of the following:
– All Currencies
– The United States Dollar (USD)
High Impact Forex Factory News Events that Affect All Currencies
> G7 Meetings
Acronyms:
– G7: Group of Seven
Release Date: Undefined
The G7 Prime Ministers and Presidents meet annually to address global challenges such as economic issues, health crises, and the climate crisis. Previous G7 summits have addressed issues ranging from debt relief for developing countries to health crises such as HIV and AIDS, as well as global security threats.
How this might affect the currency markets, and impact your trades
The G7 summit is significant since the heads of government attending are the leaders of some of the world’s wealthiest and most influential nations. Decisions made at these meetings have an effect on people all over the world, and therefore have an effect on currencies all over the world as well.
> G20 Meetings
Acronyms:
– G20: Group of Twenty
– LIDCs: Low-Income and Developing Countries
Release Date: Undefined
The G20 is a group of finance ministers and central bank governors from 19 of the world’s largest economies, including several developed countries, as well as the European Union. The G20 was established in 1999 with the mission of promoting global economic development, international trade, and financial market regulation.
How this might affect the currency markets, and impact your trades
The G20 plays a critical role in fostering a climate conducive to sustainable economic growth and development. Its work on ensuring financial stability, fostering development, and preventing and managing crises is critical in assisting LIDCs in seizing opportunities and overcoming challenges. This meeting will give a good indication to traders about the global economy and its future growth
> Jackson Hole Symposium
Also known as: Kansas City Fed Economic Symposium
Release Date: Annually
Since 1978, the Federal Reserve Bank of Kansas City has sponsored the Jackson Hole Economic Symposium, which has been held in Jackson Hole, Wyoming, since 1981. Every year, the symposium focuses on a critical economic problem confronting the world’s economies. Participants include influential central bankers and finance ministers from around the world, as well as academic luminaries and leading financial market players.
Market participants closely observe the symposium proceedings because unexpected comments from the symposium’s heavyweights have the potential to impact global stock and currency markets.
How this might affect the currency markets, and impact your trades
The symposium is closely followed by financial market participants all over the world, and it has gotten more publicity in the last decade, owing to what has happened in the past. Some of the most important monetary policies were first unveiled at the gathering, but they were not officially announced. Any unexpected comment from any individual during the event has the potential to impact global financial markets.
> OPEC-JMMC Meetings
Acronyms:
– OPEC: The Organization of Petroleum Exporting Countries
– JMMC: Joint Ministerial Monitoring Committee
Release Date: Monthly, otherwise undefined
These meetings can have a major impact on the price of Oil and all co-related currencies such as USD/CAD and the Norwegian Krone (NOK).
Representatives from 11 oil-rich nations and 13 OPEC members attend this meeting to discuss different issues related to oil production and any major issues concerning the energy markets. These are closed-door meetings, and a statement is generally released toward the end of the meeting to the press.
How this might affect the currency markets, and impact your trades
This meeting could have a substantial impact on Crude Oil and its correlating currency pairs such as the USD/CAD. Be sure to stay aware of any OPEC-JMMC Meetings if you are trading Crude Oil or the USD/CAD
> OPEC Meetings
Acronyms:
– OPEC: The Organisation of Petroleum Exporting Countries
Release Date: Twice per year
OPEC Meetings are typically held in Vienna and representatives from 15 of the world’s most oil-rich nations are usually in attendance. At the meeting a range of topics are discussed surrounding the energy markets, and an agreement is also made surrounding how much oil the nations will produce.
While the meeting is closed to the press, it’s not unusual for attendees to have talks with the press and reporters throughout the day. Once the meeting is concluded, a formal statement which covers any policy shifts or objectives from the meeting is released.
How this might affect the currency markets, and impact your trades
40% of the world’s oil supply is made up from nations of the OPEC. These nations are unified in their production levels of oil and due to their size, have a lot of control over the supply of oil around the globe. This means that any shifts in their production levels can have a major knock-on effect to oil prices and related currency pairs.
High Impact Forex Factory News Events that Affect The United States Dollar (USD)
> ADP Non-Farm Employment Change
Acronyms:
– ADP: Automatic Data Processing, Inc.
Release Date: Monthly, first Wednesday after month-end
The ADP Non-Farm Employment Change report comes just 2 days before the government-released Non-Farm Employment Change report and can provide a good indication of what the NFP release is going to look like.
The ADP looks at the payroll data of over 23 million workers within the United States to determine potential growth in employment.
How this might affect the currency markets, and impact your trades
Employment is a basic indicator of how well a country’s economy is performing. The more people working in the country, the more productive that country is overall, and therefore the more money is circulating within that economy.
If the final figure is greater than the figure that was forecast, this will likely initiate a bullish move within the markets for currency pairs that have the USD as the base currency, such as the USD/CHF, USD/JPY, USD/CAD; and a bearish move for currency pairs with the USD as the quote currency, such as the EUR/USD or GBP/USD.
> Advance GDP q/q
Acronyms:
– GDP: Gross Domestic Product
Also known as: GDP First Release; Estimated GDP
Release Date: Quarterly, about 30 days after quarter-end
This report indicates the economic stability of the economy via detailed measurable economic activity. This report can determine the risk factor that traders take on the financial markets.
How this might affect the currency markets, and impact your trades
The financial markets work on either risk on or risk off. GDP reports are a crucial element in determining the future direction of the currency’s trend. The favourable outcome is if the ‘actual’ figure is greater than ‘forecast’ figure, it shows that the economy is not only stable but is growing as well.
> Average Hourly Earnings m/m
Release Date: Monthly, on the first Friday of the new month
This report is the earliest indication of either a rise or fall in the rate of labour inflation.
If the prices of labour are higher, then these costs are typically passed onto the consumer, through the increased cost of products and/or services.
How this might affect the currency markets, and impact your trades
This is not really a market-mover as such, but depending on the overall change, it can move the markets more than might be expected.
> Building Permits
Also known as: Residential Building Permits
Release Date: Monthly, 17 days after month-end
Securing a permit is one of the first measures toward creating a new structure, it’s an outstanding indicator of potential construction operation.
How this might affect the currency markets, and impact your trades
The Building Permits reports are important market events for news trading strategies in the financial markets. As a leading indicator of the economy’s progress towards monetary policy goals, it informs both the Fed’s sentiment and the market’s sentiment towards the stocks of construction-related companies. In turn, this can create trend-setting volatility in the hours after the release and generate multiple opportunities with high risk/return ratios within the forex market.
> CB Consumer Confidence
Acronyms:
– CB: The Conference Board
Release Date: Monthly, on the last Tuesday of the month
When the actual data comes out and it is better than the forecasted prediction it means it’s good for the economy.
Each month, the Conference Board conducts 5,000 surveys with questions centred around aspects such as business conditions, employment conditions, and family incomes. This consumer sentiment survey allows the analysts to understand the expectations of consumers based on their economic circumstances.
The level of consumer trust in economic activity is determined by consumer confidence. It’s a leading indicator for the sole reason that it can estimate consumer spending, which is key to overall economic activity. Higher readings suggest that customers are more positive.
How this might affect the currency markets, and impact your trades
This Event not only has a direct effect on currencies and stock markets, but it could also have an impact on certain decisions made by the Federal Reserve of the United States.
For example, if consumer morale is declining, this would indicate that economic growth is slowing. Therefore, if the actual figure that’s released is greater than the figure that was forecast, you can expect it to have a positive impact on the US Dollar.
> Congressional Elections
Also known as: House of Representatives Elections, Senate Elections
Release Date: Every 2 years
Congressional Elections happen at two points during a President’s term. At the very beginning, concurrent with their own election, and mid-way through the President’s term.
Below we will focus specifically on the mid-term elections as the concurrent elections are typically over-shadowed by the Presidential Election itself.
The mid-term elections are often regarded as an opportunity to demonstrate satisfaction or dissatisfaction with the president’s results. In fact, it is not unusual for the minority political party (the party that does not rule the White House) to win congressional seats during the mid-term elections.
The mid-term elections are based on the two houses of Congress: The United States Senate and the House of Representatives. Members of the House are chosen for two-year terms, so the midterm elections determine all 435 seats.
How this might affect the currency markets, and impact your trades
The Congress is the entity where laws are enacted, the executive is overseen, and most significantly, money is both collected and spent. According to the founders, Congress, like the legislative and judicial branches, is an equal branch of government. As a result, electing members of Congress allows American citizens to influence their government.
Depending on the results of the elections, the ideas that the corresponding parties have around fiscal policy will have an impact on the overall strength of the US Dollar, and will therefore create volatility in the markets for traders to take advantage of.
> Core CPI m/m
Acronyms:
– CPI: Consumer Price Index
– FOMC: Federal Open Market Committee
Also known as: CPI Ex Food and Energy; Underlying CPI
Release Date: Monthly, 16 days after month-end
Core CPI is similar to the typical CPI except for one important detail.
Core CPI doesn’t include either Food or Energy prices within the report. These two factors would typically account for around 25% of the CPI report. The reason these are not included in the Core CPI report is because they’re naturally volatile goods and services. Removing these two factors gives a more accurate view of how the Consumer Price Index is fluctuating and what the currencies level of inflation would be. The FOMC pays much more attention to the Core CPI report than it does the typical CPI report for this very reason.
How this might affect the currency markets, and impact your trades
Having this better view of inflation gives traders an insight into how interest rates may be altered in order to bring inflation under control as per the Fed’s inflation containment mandate.
Interest rate changes can have a substantial impact on a currency and so keeping informed on the Core CPI each month will ensure you’re in a good position as a trader to take advantage of potential interest rate announcements.
> Core Durable Goods Orders m/m
Also known as: Durable Goods Orders Ex Transportation
Release Date: Monthly, about 26 days after month-end
A higher reading means that manufacturing activity has increased. A reading that is higher than expected is generally positive for the USD, therefore a reading that is lower than expected is generally negative for the USD.
The improvement in the overall value of new orders for long-lasting manufactured products (except transportation items) is determined by Core Durable Goods Orders. Since aircraft orders are highly unpredictable and take several months to fill, the core number provides a more accurate picture of ordering patterns.
How this might affect the currency markets, and impact your trades
The term “Core Durable Goods Orders” applies to new orders for such goods in the United States, which are the total durable goods orders with the exception of transportation equipment.
Traders closely track the new orders figures because they can provide a great insight into current economic conditions, as well as future manufacturing production commitments.
> Core Retail Sales m/m
Also known as: Retail Sales Ex Autos
Release Date: Monthly, 16 days after month-end
The core retail sales figure is based on Census Bureau data but excludes consumer spending on cars, gasoline, construction materials, and food services. The reason for this is simply because prices for these items are much more volatile and can quite easily distort the overall figure. This statistic reflects the monthly percentage increase or decrease in Core Retail Sales.
How this might affect the currency markets, and impact your trades
The percentage increase or decrease from month to month indicates whether the economy is either shrinking or expanding, as well as how quickly. Retail sales that are extremely high or extremely weak may place upward or downward pressure on retail prices. If retail sales continue to increase, upward pressure on prices will eventually take hold, especially if the figures continue to rise month after month.
Therefore, if the figure reported is higher than the figure predicted, this can be positive for currency and bring opportunities for traders to take advantage of.
> CPI m/m
Acronyms:
– CPI: Consumer Price Index
Release Date: Monthly, 16 days after month-end
The Consumer Price Index report measures what changes there have been in the prices of both goods and services that have been purchased by consumers. This report helps to determine the rate of inflation as consumer prices play a significant role in the increase or decrease in inflation. However, there is always going to be some level of volatility within the CPI figure as both food and energy are naturally fluctuating goods/services that may potentially skew the figures.
How this might affect the currency markets, and impact your trades
While CPI may not be as accurate as Core CPI (CPI excluding Food and Energy Prices) in determining the potential rise or fall of inflation, it’s still an important report to be aware of as a financial trader. Be sure to keep informed on both the CPI and Core CPI to give yourself the best chance of predicting where the market might move.
> Crude Oil Inventories
Acronyms:
– EIA: Energy Information Administration
Also known as: Crude Stocks; Crude Levels
Release Date: Weekly, 4 days after week-end
The Crude Oil Inventories figure shows how many barrels of crude oil commercial firms have on hand. The Energy Information Administration receives weekly reports from commercial companies on inventory levels, but the EIA must also make certain calculations to arrive at the final figure.
How this might affect the currency markets, and impact your trades
Crude Oil is a major commodity within the United States. However, this event can have a significant impact on the Canadian Dollar as the Canadian Energy Sector is monumental, and shares a somewhat symbiotic relationship with the prices of Crude Oil.
If the Crude Oil Inventories figure rises, it is a poor indicator for oil producers as they’re holding more stock, which typically leads to a decrease in the price in order to move that stock. If the inventory figures fall, this is a good indicator as it signifies that demand is high, and therefore prices for oil will be able to increase in order to maintain sufficient supply.
> Existing Home Sales
Also known as: Home Resales
Release Date: Monthly, 20 days after month-end
The transaction data for the sales of existing homes in the United States tracks and records both sales and prices of existing single-family homes, condos, and co-ops by region: West; Midwest; South; and Northeast.
How this might affect the currency markets, and impact your trades
Existing Home Sales are vital for predicting the health of the housing sector and it therefore has a direct effect on the markets. When the data comes out and it is stronger than expected, this is good for the economy, and would encourage traders to buy into the market.
> Fed Announcement
Acronyms:
– Fed: Federal Reserve
– FOMC: Federal Open Market Committee
Also known as: Fed Statement
Release Date: Undefined
The Fed Announcement is a mechanism used by the FOMC to convey monetary policy to investors. It includes policy decisions as well as comments on economic factors that affect their decisions.
How this might affect the currency markets, and impact your trades
This event is undefined and typically includes sporadic decisions and/or policy changes. FOMC statements are typically scheduled, however those decisions or statements that are unscheduled are typically included within the Fed Announcement. It’s important to keep informed on these Announcements as they can have a substantial impact on the markets, depending on the subject matter that’s covered.
> Fed Chair ____ Speaks
Acronyms:
– Fed: Federal Reserve
Release Date: Undefined
When the Fed Chair speaks, it is important for traders and investors to pay close attention to what is being said as there can occasionally be clues to what the future interest rate policy might be, and deciphering those clues will give traders and investors an edge when those interest rate decisions are announced.
How this might affect the currency markets, and impact your trades
The Fed Chair is the head of the central bank and the central bank controls short-term interest rates; therefore, the Fed Chair has a greater influence over the value of the nation’s currency than anyone else, including the President.
Being aware of the Fed Chair’s public engagements is paramount if you’re wanting to trade the US Dollar. Oftentimes there will be clues and hints which will point to future changes or implementations of economic policies which will in-turn affect the US Dollar’s value. Scrutinising these public engagements is one of the factors that separates the casual traders from the professional.
> Fed Chair ____ Testifies
Acronyms:
– Fed: Federal Reserve
Release Date: Undefined
The Fed Chair testifies to a number of government committees and sectors all throughout the year. Oftentimes the Fed Chair will testify alongside the Treasury Secretary and so depending on the subject matter at hand, it can have a significant impact on the markets.
How this might affect the currency markets, and impact your trades
Typically, these engagements are split into two segments. A prepared statement, followed by a Question and Answer session. As both the questions and answers are un-scripted, there can be some unexpected developments which have the potential to heavily impact the markets.
Keeping on top of these events and paying close attention to the Q&A session could provide some beautiful trading opportunities in the market.
> Fed Chairman Nomination Vote
Release Date: Every 4 years
The chair is chosen by the President of the United States from among the members of the Board of Governors and serves a four-year term following confirmation by the United States Senate.
A chair can serve multiple consecutive terms, each of which requires a new nomination and confirmation. William Martin was the longest-serving chair, serving from 1951 to 1970, with Alan Greenspan coming in a close second. The chair may not serve at the pleasure of the President, which means that he or she cannot be fired by the President; however, the chair can resign before the term expires.
How this might affect the currency markets, and impact your trades
The Chairman of the Federal Reserve is the single most influential figure when it comes to economic policy and therefore the overall value of the US Dollar. Due to this influence, significant volatility is to be expected when the vote happens as it marks the direction that will be taken going forwards regarding economic policy.
This volatility is a great opportunity to trade the markets, so long as you’re well-informed on the economic ideals of each potential Fed Chair preceding the vote.
> Federal Funds Rate
Acronyms:
– FOMC: Federal Open Market Committee
Also known as: Interest Rates; Fed Funds Rate
Release Date: Scheduled 8 times per year
The Federal Funds Rate is the interest rate charged by banks to each other for lending Federal Reserve funds overnight. These funds are lent by banks from one another in order to meet and retain strict reserve requirements.
The Federal Reserve also uses it as a mechanism to control the country’s money supply in order to achieve a stable economy, as well as a benchmark for interest rates on savings, loans, credit cards, and other items.
How this might affect the currency markets, and impact your trades
This event is high impact, which means when the data gets released a lot of volatility will likely come into the market.
If inflation becomes too high, the Fed will consider raising the Fed Funds Rate. This decreases the amount of money available for lending by banks, slowing both consumer borrowing and demand. It can also make consumer debt costlier, causing consumers to spend less, which in turn lowers demand and prices for goods and services.
If inflation falls, it indicates, among other things, that consumers are not spending. This is not good for the central bank because it could lead to a recession. In this case, the Fed is more likely to lower interest rates in order to increase economic activity. A lower interest rate means less expensive borrowing for both customers and companies, which can help contribute to economic growth.
> Final GDP q/q
Acronyms:
– GDP: Gross Domestic Product
Release Date: Quarterly, 85 days after quarter-end
Gross Domestic Product is simply the total market value of all goods and services produced in a particular country. In the case of the United States, this total can be broken down into four main categories: Consumption; Investment; Government Expenditures; Net Exports.
How this might affect the currency markets, and impact your trades
Economic data reports are critical for a forex trader. These significant economic indicators trigger uncertainty and a lot of speculation. GDP is especially important as it shows the total effect that policies, companies, and consumers have had on the bottom line of a country’s wealth and progress.
Forex traders track this vital piece of economic data, to help pinpoint new trading opportunities, or simply to understand how strong an economy might be at any given point in time. The stronger the currency, the more bullish the overall trend is expected to be.
> Flash Manufacturing PMI
Acronyms:
– PMI: Purchasing Managers’ Index
Release Date:Monthly, 3 weeks into the month
The Flash Manufacturing PMI is a strong predictor of where the final PMI figure will be. The Flash Manufacturing PMI reading is an estimation of a country’s Manufacturing Purchasing Managers’ Index (PMI) based on approximately 85 percent to 90 percent of total PMI survey responses per month. The goal is to provide an accurate foreshadowing of the final PMI data.
How this might affect the currency markets, and impact your trades
It is a leading indicator of economic health – businesses react quickly to market conditions, and their purchasing managers hold perhaps the most current and relevant insight into the company’s view of the economy.
> FOMC Economic Projections
Acronyms:
– FOMC: Federal Open Market Committee
Release Date: Scheduled 4 times per year
The FOMC’s stated aim is to pursue monetary policy that “effectively promotes the goals of full jobs, stable prices, and moderate long-term interest rates.” Their meetings are held to make monetary policy decisions, review economic and financial conditions, and determine market stability and job performance. It is the Fed’s governing body that decides national monetary policy. The FOMC’s effect can be seen in the case of adjusting the Fed Funds Rate, which affects interest rates. If the Federal Funds Rate is boosted, the cost of home mortgages, loans, and credit cards will rise. When the Federal Funds Rate is reduced, the reverse occurs.
How this might affect the currency markets, and impact your trades
The FOMC, or Federal Open Market Committee, is the Fed’s monetary policymaking body. It is in charge of designing a strategy to support market stability and economic development. Simply put, the FOMC is in charge of the nation’s money supply. All Federal Reserve Bank Presidents attend FOMC policy meetings.
> FOMC Meeting Minutes
Acronyms:
– FOMC: Federal Open Market Committee
Release Date:Scheduled 8 times per year, 3 weeks after the Federal Funds Rate is announced
The committee is part of the Federal Reserve System of the United States, which is the legislative body in charge of monetary policy in the United States. In general, this is accomplished by establishing objectives in the free market and managing securities for the US Treasury. The Federal Reserve Bank of New York performs the bulk of free market operations.
How this might affect the currency markets, and impact your trades
The FOMC is of particular interest to currency traders because it collaborates closely with the Treasury on currency matters. The Treasury normally sets policies for the dollar’s value, but the FOMC guides monetary practices.
> FOMC Member ____ Speaks
Acronyms:
– FOMC: Federal Open Market Committee
Release Date: Undefined
The FOMC (Federal Open Market Committee) is the division of the US Federal Reserve that decides monetary policy. FOMC announcements are one of the most awaited events on the economic calendar because they remind everyone about the US Federal Reserve’s interest rate decision. The FOMC can decide to raise, lower, or maintain interest rates at current levels, which will have a significant impact on currency values. The Board of Governors of the FOMC is made up of seven members and five reserve bank presidents.
Any time a member of the FOMC speaks, it can be a precursor to a policy change, or have subtle clues about the future of monetary policy. It’s important to keep up to date with every time a member of the FOMC speaks publicly as this could have an impact on the markets.
How this might affect the currency markets, and impact your trades
Central banks may surprise the market with a rate hike or cut. When this occurs, a trader should be able to predict which way the market will shift. If interest rates rise, the currency would appreciate, causing traders to buy. If interest rates are cut, traders would most likely sell and buy currencies with higher interest rates.
Keeping on top of public speeches by members of the FOMC may help to give you an edge as to what might be expected if such a decision is made.
> FOMC Press Conference
Acronyms:
– FOMC: Federal Open Market Committee
– Fed: Federal Reserve
Also known as: Chair’s Press Briefing
Release Date: Scheduled 8 times per year
The FOMC Press Conference is typically an hour long, and consists of two parts. The first part is the reading of a prepared statement by the Fed Chair, and the second part is a question and answer session with the press.
As the questions and answers are unscripted, they can often create volatility in the market, depending on the subject matter that is being discussed.
How this might affect the currency markets, and impact your trades
The FOMC Press Conference is one of the main ways that the Federal Reserve communicates monetary policy to investors. It covers a whole heap of important information, such as the reasons behind the latest monetary policy decisions, as well as what the future looks like with regards to growth and inflation.
All of these aspects are major players when it comes to assessing the USD from a fundamental perspective, and careful attention should be paid to events such as the FOMC Press Conference.
> FOMC Statement
Acronyms:
– FOMC: Federal Open Market Committee
Also known as: Interest Rate Statement; Fed Statement; Monetary Policy Statement
Release Date: Scheduled 8 times per year
The FOMC Statement is the most prevalent way that the FOMC uses to communicate monetary policy to investors and the population as a whole. Typically, the statement is changed slightly with each release.
How this might affect the currency markets, and impact your trades
The FOMC Statement includes the results of the FOMC vote on interest rates as well as a number of other monetary policy measures. It also explains in detail the reasons behind those decisions and the economic factors that pushed each member to their conclusion.
What you really want to look out for however is the economic outlook and what the outcome of future FOMC votes may be, so that you can get an edge on the next Statement release.
> ISM Manufacturing PMI
Acronyms:
– ISM: Institute for Supply Management
– PMI: Purchasing Managers’ Index
Also known as: Manufacturing ISM Report on Business
Release Date: Monthly, on the first business day of the new month
The ISM Manufacturing PMI surveys around 300 Purchasing Managers in the Manufacturing sector to determine the level of a diffusion index. It’s a good indicator of economic health as businesses will typically react very quickly to changing market conditions. Purchasing Managers are the first on the scene, so to speak. Put simply, if a company is buying, they believe the economy is doing well, and the buying is carried out by the Purchasing Managers.
How this might affect the currency markets, and impact your trades
Typically, the 50.0 mark is your baseline, or break-even point when investigating if industry is expanding (>50.0) or contracting (<50.0). However, you will want to look closely at the Forecast as this will often determine which way the currency will move. Combining these two factors (the 50.0 baseline and the Forecast figure) will give you the best chance to trade this event once the actual figure has been released.
This event is sibling to the ISM Services PMI for which you would follow a similar approach
> ISM Services PMI
Acronyms:
– ISM: The Institute for Supply Management
– PMI: Purchasing Managers’ Index
Also known as: Non-Manufacturing PMI; Non-Manufacturing ISM Report on Business
Release Date: Monthly, on the third business day of the new month
The ISM Services PMI surveys around 300 Purchasing Managers in the Services sector to determine the level of a diffusion index. It’s a good indicator of economic health as businesses will typically react very quickly to changing market conditions. Purchasing Managers are the first on the scene, so to speak. Put simply, if a company is buying, they believe the economy is doing well, and the buying is carried out by the Purchasing Managers.
How this might affect the currency markets, and impact your trades
Typically, the 50.0 mark is your baseline, or break-even point when investigating if industry is expanding (>50.0) or contracting (<50.0). However, you will want to look closely at the Forecast as this will often determine which way the currency will move. Combining these two factors (the 50.0 baseline and the Forecast figure) will give you the best chance to trade this event once the actual figure has been released.
This event is sibling to the ISM Manufacturing PMI for which you would follow a similar approach
> JOLTS Job Openings
Acronyms:
– JOLTS: Job Openings and Labor Turnover Survey
Release Date: Monthly, 40 days after month-end
The Bureau of Labor Statistics conducts the Job Openings and Labor Turnover Survey (or JOLTS) on a monthly basis. This survey examines employment records, work vacancies, the number of employees employed, the number of employees who resigned, layoffs and discharges, and other separations from 16,000 US companies. The report includes both the private and public non-farm industries.
How this might affect the currency markets, and impact your trades
Despite its volatility, the JOLTS study provides us with a good picture of Labour-force demand and economic health. When businesses intend to increase output, the demand for workers rises. If this increase in demand creates a demand-supply imbalance, wage increases may be necessary to recruit new workers. Rising wages may result in increased spending and a higher rate of inflation.
> New Home Sales
Also known as: New Residential Sales
Release Date: Monthly, 25 days after month-end
The data for New Home Sales is collected by interviews with home-builders and analysis of data from the U.S. Census Bureau’s Survey of Construction. It specifically employs information from Building Permits issued for new construction projects. If a deposit was paid for the purchase of a new home, or if a contract to purchase the home was signed during or after the year of its completion, the home is included in the calculation.
How this might affect the currency markets, and impact your trades
Investors closely track New Home Sales because it is seen as a lagging predictor of real estate market demand and, therefore, a factor influencing mortgage rates. Factors such as household income, unemployment, and interest rates all play a role.
> Non-Farm Employment Change
Release Date: Monthly, on the first Friday of the new month
Also known as: Non-Farm Payrolls; NFP; Employment Change
When the actual data comes out and it is better than the forecasted prediction, it’s good for the economy and the US Dollar.
Non-Farm Employment Change is one of the most important USD-related news and has a great impact on the Forex market. Its effect on the Forex market helps to generate clear buy/sell signals, which expert Forex traders can pick up on and trade. There are two things Forex traders want: Volatility, and indications to trade. The Non-Farm Employment Change Report provides both of these almost every single month.
How this might affect the currency markets, and impact your trades
A rise in Non-Farm Employment will typically translate into a rise in the value of the US Dollar. Therefore, currency pairs that have the USD as the base currency, such as the USD/CHF, USD/JPY, USD/CAD, are going to go up; and currency pairs with the USD as the quote currency, such as the EUR/USD or GBP/USD, are going to go down.
A Non-Farm Employment change press release that is substantially higher than previous month will generate long-term trade or buy signals in the Forex market for USD-related pairings.
> Pending Home Sales m/m
Also known as: Pending Resales
Release Date: Monthly, 28 days after month-end
The National Association of Realtors’ Pending Home Sales report is a leading indicator of housing market patterns in the United States. It tracks the change in the homes currently contracted to be sold, but are awaiting the closing transaction. This does not include new constructions.
Since the housing market is a sensitive factor in the US economy, it causes some uncertainty in the USD.
How this might affect the currency markets, and impact your trades
There are a number of economic health factors that stem from a home being sold, such as mortgages, renovations, real-estate fees, and so on.
It’s a strong leading indicator as it gives traders an idea of what is to be expected for the economy once these homes are considered ‘sold’ and gives a good idea of the economic pipeline within the housing industry.
> Philly Fed Manufacturing Index
Also known as: Philadelphia Fed Business Outlook Survey
Release Date: Monthly, on the third Thursday of the month
The survey is a gauge of regional manufacturing expansion. When the index is above zero, it indicates factory-sector expansion; when it is below zero, it indicates factory-sector contraction. The survey’s aim is to provide a snapshot of current manufacturing activity in this region as well as a short-term forecast of manufacturing conditions in the area, which may provide an indicator of conditions across the United States.
How this might affect the currency markets, and impact your trades
Despite the fact that the Survey only polls manufacturers in a small portion of the United States, it can be a useful predictor of economic and business activity around the nation. Since manufacturing is so important to overall economic growth, the health of the sector is an indicator of the health of the overall economy, and the Philadelphia Fed Survey could provide early warning signs of problems in the regional sector, and therefore the overall U.S. economy.
> PPI m/m
Acronyms:
– PPI: Producer Price Index
Also known as: Finished Goods PPI; Wholesale Prices; PPI for Final Demand
Release Date: Monthly, 13 days after month-end
Manufacturers’ inflation rate is calculated by the Producer Price Index (PPI). The reading reflects the monthly shift in the average price of a predetermined basket of products purchased by producers. Higher interest rates usually contribute to higher inflation, which helps to boost the country’s currency.
How this might affect the currency markets, and impact your trades
PPI depicts the inflation picture from a different angle than CPI. While changes in consumer prices are significant to customers, monitoring PPI helps one to determine the cause of CPI changes. If, for example, CPI rises much faster than PPI, this could mean that factors other than inflation are forcing retailers to raise their prices. However, if both the CPI and the PPI rise at the same time, retailers can simply be attempting to preserve their operating margins.
> Prelim GDP q/q
Acronyms:
– GDP: Gross Domestic Product
Also known as: GDP Second Release
Release Date: Quarterly, 60 days after quarter-end
The gross domestic product (GDP) is simply the overall market value of all goods and services produced in a given country. This total can be broken down into four major categories in the United States: Consumption; Investment; Government Expenses (or spending); and Net Exports.
How this might affect the currency markets, and impact your trades
The gross domestic product report, like every other piece of significant economic data, carries a lot of weight for currency traders. It shows development in a productive economy while signalling contraction in a declining one. As a result, currency traders will appear to pursue higher GDP or growth rates in the hope that interest rates will follow suit. When an economy expands at a reasonable pace, the benefits flow down to the customer, raising the probability of investment and expansion. In exchange, higher spending leads to higher costs, which central banks aim to regulate by raising interest rates.
> Prelim UoM Consumer Sentiment
Acronyms:
– UoM: University of Michigan
Release Date: Monthly, around the middle of the month
Every month, the University of Michigan surveys approximately 600 households on their views and attitudes toward their own personal economic circumstances, the overall economy, and the idea of making major household purchases at this time.
How this might affect the currency markets, and impact your trades
Consumer spending has an effect on supply and demand. More investment can boost the economy, while less spending can stifle it. Spending can have an effect on corporate income, corporate investments, jobs, and other factors, all of which can have an impact on the larger market and economy. It is a feedback loop, and whether it is positive or negative is determined by emotion.
The consumer sentiment index, as a leading indicator, may provide some insight into how people will spend in the near future based on their optimism or pessimism about the economy.
> President ____ Speaks
Release Date: Undefined
There are a number of scheduled events that the President of the United States will typically speak at, such as the State of the Union address. However, there can be a number of sporadic press conferences and the like all throughout the year. Depending on the subject matter in question, these can have a drastic effect on the markets as they can affect things like consumer sentiment or investor confidence.
How this might affect the currency markets, and impact your trades
When it comes to the currency markets it is worth keeping an eye on what the world leaders are saying and doing and seeing where you can correlate their significant movements with movements in the currency markets to understand their impact and predict future impacts. Remember it doesn’t have to have an immediate or clear business impact to have an impact on the financial markets.
> Presidential Election
Release Date: Every 4 years
Political parties mostly support elected leaders in the United States. These groups – associations of politicians, candidates for elected office, and their supporters – pick and help the representatives they want to represent them in elections. In the United States, there are two main political parties that hold the majority of elected positions: The Republicans and the Democrats. Other parties can play a role in an election, but for the past 150 years, all U.S. presidents have come from one of the two major parties.
How this might affect the currency markets, and impact your trades
With expected movements across currency pairs, indices, and commodities, the run-up to the election could present trading opportunities. Such uncertainty is also expected to last until at least January of the following year. EUR/USD, USD/JPY, GBP/USD, and other common USD crosses are likely to be influenced by the winner’s upcoming foreign policies.
> Retail Sales m/m
Also known as: Advance Retail Sales
Release Date: Monthly, 16 days after month-end
Retail sales are a clear predictor of an economy’s health and whether it is shrinking or expanding. The significance stems from the fact that retail sales account for nearly half of personal consumption, which accounts for nearly 70% of GDP. Retail sales account for nearly one-third of GDP in terms of direct economic activity.
How this might affect the currency markets, and impact your trades
The percentage rises and falls often reflect how rapidly the economy is shrinking or expanding. Retail sales that are extremely high or extremely weak may also place upward or downward pressure on prices. As retail sales increase, upward pressure on prices can grow, particularly if sales figures continue to rise month after month. The same is true when sales are extremely low, placing downward pressure on prices as customers spend less, and again when sales are extremely low over an extended period of time.
> Trade Balance
Also known as: International Trade in Goods and Services
Release Date: Monthly, 35 days after month-end
The Trade Balance is the net amount of a country’s goods exports and imports, excluding all capital transactions, deposits, and other financial components. If the value of exports exceeds the value of imports, a country’s trade balance is positive (meaning it has a surplus). If the value of imports exceeds the value of exports, a country’s trade balance is negative, or it reports a deficit. The official term for net exports in the current account is the Trade Balance.
How this might affect the currency markets, and impact your trades
The country’s currency is directly influenced by Trade Balance. If a country’s exports outweigh its imports, we may assume that its goods are in high demand on the global market. This would have a direct positive effect on that country’s currency as demand for its currency grows. This occurs because if there is a strong demand for the goods, prices rise and the currency’s value rises. In contrast, if a country’s imports exceed its exports, it means that there is less global demand for the goods manufactured by that country. As a result, there would be less demand for its currency, resulting in a weakening of its value.
> Treasury Sec ____ Speaks
Release Date: Undefined
The United States Treasury Secretary makes regular speeches, however only the ones that might have a direct impact on the financial markets will be listed with the Forex Factory Economic Calendar.
How this might affect the currency markets, and impact your trades
The Treasury Secretary is the mouthpiece of the President’s economic policies and any speeches that he makes that are listed on the Forex Factory Economic Calendar could signal a shift in monetary policy. These speeches are often used to communicate those shifts to both the public as well as foreign governments.
> Unemployment Claims
Also known as: Jobless Claims; Initial Claims
Release Date: Weekly, first Thursday after week-end
For a trader, the word unemployment is extremely important because it reveals information about the current state of the nation’s economy. Jobless claims are considered a lagging indicator, which means that the indicator changes only as the economy changes and is expressed in the figures. It triggers a lot of market uncertainty after each release because this knowledge alone affects economic stability, monetary policy, and interest rates in the upcoming decision making by the banks.
If the initial jobless claims are too high, the government attempts to boost the struggling economy by generating employment and introducing tax-free schemes for the unemployed. In the United States, the Federal Reserve would lower the Federal Funds Rate, thus loosening monetary policy. If this fails to stimulate the economy, the federal government will implement monetary policy initiatives, recruit workers for public works programmers, and attempt to stimulate demand through tax breaks.
Lower-than-expected figures usually result in more jobs earning wages and higher consumption spending. This will result in inflationary pressure, which causes interest rates to increase. High levels of unemployment resulted in lower wages, decreased economic activity, and decreased consumption. However, a decrease in initial jobless claims is a hopeful sign and could push the currency upward.
How this might affect the currency markets, and impact your trades
The initial jobless claims are extremely important to forex traders because they are very effective in predicting how monetary policy will respond to Labour market conditions. Monetary policy changes, or a lack thereof, may often cause the value of a currency to rise or fall. Though it may be considered a meaningless number at times, there is no denying that the initial jobless claims can have an effect on currency prices.
> Unemployment Rate
Also known as: Jobless Rate
Release Date: Monthly, on the first Friday of the new month
The unemployment rate is the proportion of the work force that is unemployed. It is a lagging indicator, which means that it rises and falls in response to changing economic conditions rather than predicting them. When the economy is in bad shape and work opportunities are scarce, the unemployment rate is likely to increase. It can be expected to fall as the economy is expanding at a healthy pace and jobs are abundant.
How this might affect the currency markets, and impact your trades
The unemployment rate is used by investors and the general public to understand the state of a country’s economy and as an indicator of how well the government is running the country. A high unemployment rate indicates that the economy is unable to provide enough jobs for those looking for work. High unemployment not only exacerbates social problems and prolongs family misery, but it also makes the country less appealing to foreign investors, reducing investment funds coming into the country.
Last minute tips on the Forex Factory calendar:
If you are just beginning on your Forex trading journey, don’t jump into this just yet. First, you must learn the basics of trading, before you get well-acquainted with the calendar. If you dive in head first, without knowing the context of what is on the calendar, you may just find yourself frustrated and disappointed with the results
However, if you are just someone who is looking to strengthen your trading skills, then the Forex Factory calendar is definitely worth investing time in. You will be able to enjoy a distinct advantage that your competitors won’t have.
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