Top 5 leading economic indicators which drive your forex trading

Today, there are so many different factors affecting current foreign currency exchange market. When you are willing to invest on the forex trading, it is highly essential to know and understand different factors which cause the currency exchange market to fluctuate from day to day. The changes in forex market actually depend on the different economic factors which play a very big role in the movement of different currencies. Economic indicators and reports released by the government or any private organizations basically express a particular economic performance of the country. These indicators measure the economic health of the country, current events, and also government policies. The 5 economic articles include,

Current events and economic state:

Current events and the economic state of the country is actually the top economic indicator used when analyzing the forex market. Housing statistics, unemployment numbers, and current government state will affect the currency exchange market and make reflection in the prices. When a particular country experiences the political unrest, inflation, and the maximum unemployment rates, the currency rate will be seriously affected. This particular indicator tends to be ignored, but it can play a very important role in the fluctuations of a forex market.

GDP (Gross Domestic Product):

Gross Domestic Product is another main economic indicator which is used when looking at the forex market. It is considered the broadest and widest measure of the country’s economy. GDP represents a total monetary value of all products and services produced within a specific country over a particular period. It is usually measured on the annual basis but quarterly states will also be released.

Retail sales reports:

Retail sales reports is one of the economic articles considered for the forex market ups and downs. This indicator actually tracks the goods sold by the companies within a retail trade and measuring a total customer spending on the retail sales in any nation. It is the most reliable and very important economic indicator because it will show customer spending patterns and confidence which might indicate increased economic activities throughout a year.

Industrial production report:

It is a next reliable economic indicator in the forex market. This industrial production report basically measures a change in the production of the countries mines, factories, and also utilities. This report also measures an industrial capacity and how many existing resources are being used. When the production of a country is at the maximum capacity, it is considered a perfect condition and will make positive effect on the foreign currency exchange market.

CPI (Consumer Price Index):

Consumer Price Index is the last important economic indicator which drives your forex market. It is actually the measure of the price change of the consumer services and products. When considering the most widely used measure of the inflation, this CPI is also regarded as an important indicator of the effectiveness related to the government policy. This measurement can tell whether a country is making or losing money on its products and services. A rising measurement of CPI will indicate the inflation in the forex market.

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