The big one. Increases in interest rates cause a currency to appreciate as foreign capital is attracted by the incentive of higher returns on their money, which causes its value to rise. There are many ways investors try to predict interest rate changes, from the Federal Reserve Chair's speeches to CPI figures. They look for signs that central banks may considering changing rates. You can do the same.
Economies are said to be performing well when the companies that operate in them are performing well enough to be able to expand their workforce. This results in more spending in the economy as people are employed so have more money to spend, and as overseas companies invest. When they are doing this they need to invest with the local currency so it appreciates. This increased spending is likely to increase inflation which can lead to central banks hiking interest rates. Economic indicators such as inflation, retail sales and unemployment figures are released monthly and are used by central banks to consider interest rates.
Commitment of Traders reports are released weekly and give an overview of the general direction different participants in the futures market are trading. The commercial aspect refers to business and large corporations which employ the best economists so being on their side isn't normally a bad thing. Opposed to commercial is is non-commercial traders. They tend to be tipped against commercial traders and generally loose money.
Balance of Payments
Trade balance information is released monthly and gives the difference in the value of imported and exported goods during the reported month. It both affects and is affected by exchange rates as if you wish to buy something from another country then you need to purchase their currency to do so. When there is a strong demand for an economy's goods, its currency appreciates as there is more demand for it, the change in the balance of payments can sway investors outlook for an economy as demand for the currency increases when demand for locally produced products increases from abroad.
9/24/2021 The People's Bank of China banned all crypto transactions on overseas Chinese services along with its domestic ban. Bitcoin is down over 8% today and Ethereum is down 11.48%. Our outlook I think we're seeing a lot of noise around China and their condemning of cryptocurrencies before they digitize their own. In the short […]
Let's look into the Bank of England's Monetary Policy Summary which took place on Thursday the 23rd of September, 2021. Quick Summary: BoE keeps interest rates unchanged at 0.10% BoE will maintain its asset purchasing target at £875B The vote to keep policy unchanged passed with a 7-2 vote The minutes of the MPC meeting […]
9/23/2021 The precious metal snapped three days of gains and tumbled back down to the support range from $1740s-1760s approximately. Gold is down -.56% on the day going into the opening of the NY session. Our outlook Gold will likely rise on the US indices falling, and is usually due to slowing economic growth. Because […]
9/21/2021 Bitcoin Update For the past month, Bitcoin went on a tear rising over 20% from the beginning of August. Recently, however, China and other risk-off factors have contributed to a 23% decline from the recent highs around $52,760. Now the most prominent crypto has touched these monthly lows which could be a potentially good […]