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The principle of this sub-group impact is based on the axiomatic statement that the rate of any currency is the derivative of this country economic development. Stability of economic development specifies foreign investors interest in the capital expenditures to the country and, correspondingly, demand on the national currency. The data of economic development of a country include such key indicators as balance of trade and balance of payment, inflationary rates, unemployment rate, GDP etc.
In the Forex market a unified system of currencies quotation through the US dollar was elaborated. Thus, the US economic development and the dollar rate are the key factors, which specify market movement, common to the main currencies. That is why the US dollar and its behavior are in the limelight, as they trigger some specific reaction of other currencies. Frankly speaking, it doesn't eliminate other factors impact, such as policy of the national banks or influence of the related markets, which will be described briefly a bit later. In the USA the main indicators of economic development are released monthly or quarterly.
Table 1. Impact of the most important economic indicators on the national currency exchange rate
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| Indicator | Market importance | Indicator changing | Changing of the national currency exchange rate |
| Trade deficit | 1 | increase | decrease | | Payment deficit | 1 | increase | decrease | | CPI and PPI | 1 | increase | decrease | | Official interest rates | 1 | increase | increase | | GDP | 1 | increase | increase | | Unemployment | 1 | increase | decrease | | M4, M3, M2, M1, M0 | 1 | increase | decrease | | President or Parliament elections | 1 | increase | - | | Retail sales | 2 | increase | increase | | Housing starts | 2 | increase | increase | | Orders | 2 | increase | increase | | Industrial production | 2 | increase | increase | | Productivity | 2 | increase | increase | | Forward currency rates | 3 | - | - | | Futures currency rates | 3 | - | - | | Effective exchange rate | 3 | - | - | | Deposit repos | 3 | - | - | | Index shares (DJI, NIKKEY, DAX, FTSE) | 3 | increase | increase | | State bonds prices (T-bills, T-bonds) | 3 | increase | increase |
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Trade negotiations
Trade negotiations are the important part of economic policy of any country. In particular, such the important economic indicator as trade balance represents the difference between export and import. In case the sum of exported goods and services exceeds the price of imported ones Trade Balance is positive (surplus), in case import surpasses export it is negative (deficit). The trade deficit is the main problem for the USA within the last years. It is one of the reasons of the dollar fall against the major European currencies. Results of trade negotiations have an immediate impact on the market.
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