An economic calendar is used daily by investors to track market-moving developments, including economic indicators and governmental policy choices. Market-moving events have a high likelihood of affecting the global economy. Businesses tend to move their assets and investments along with trading, cutting their working capital short term. The reduction of corporate cash resources leads to slower investment growth. In addition, during times when economic indicators are weak, financial institutions continue to tighten credit standards for lending.
Economic Calendars helps investors and policy makers to assess the state of the global economy. The main indicators are interest rates, consumer price indices, gross domestic product (GDP), employment, industrial production, and other economic aspects. Policy makers use the economic calendar to take corrective action if needed. For instance, if the unemployment rate is rising above the level that is considered optimal, it may be a time for interest rates to be lowered. Interest rates set by central banks control the level of currency that is issued, affecting the international exchange rate system (ICX).
The economic calendar provides daily trading opportunities for long and short traders. Long-term trading occurs on the interbank market, while short-term trading occurs over the counter (OTC). The primary difference between the two types of trading is the length of time each trade lasts. For instance, long-term trades will continue until the bank removes its restrictions on short selling and purchasing.
Economic Calendars creates detailed charts that allow users to see the relationship between economic calendars and various indicators. Most investors use these tools to determine their investing thesis. One can compare the performance of various economic calendars to make informed trading decisions. The indicators used to construct the charts typically include inflation, key indicators of market volatility, balance of payments, trade flows, and other economic indicators.
Investors can analyze data in the economic calendar in order to determine when they should enter or exit particular markets. They can also use this tool to determine which markets are “scared”. When markets are “scared”, it means that there is low volatility in the market. When markets are “upside down”, it means that there is high volatility in the market. The analysis of the scheduled data is particularly useful for traders who need an indicator of when to enter or exit a market.
The economic calendar allows a trader to see the impact of global trade on the rates of their stocks. The GDP cost guide shows changes in the price of selected currencies, especially when the currency is expected to increase in value. In the United States, the guide indicates that the expected growth in the GDP price is 2.5 percent in the second half of this year. Based on historical data, the expected growth rate of the GDP cost is fairly fast, but traders must take into account the effects of inflation on the value of a specific currency.
Other scheduled news events have a significant effect on the price of selected currencies. When a country’s central bank issues a release about interest rates, the traders will look at the implied interest rate of a different currency. Economic calendars may also include data on upcoming announcements by central banks on the balance sheet, including revisions to the balance sheet guidelines. These releases are particularly important to foreign exchange traders who have to make constant adjustments based on the balance sheet guidelines released by various banks.
The economic calendars provide valuable information for traders who depend on precise data for making their day-to-day trades. Traders can also use the calendars for other purposes, aside from learning more about the movements of the economy. Some of these uses include determining the appropriate time to enter a trade, determining which currencies to trade against, determining when to close a trade, and learning more about potential trading partners. A number of newspapers publish special sections with published calendars, as well as online sources. The contents of these newspapers and sources are usually compiled into useful guides that are easy to use, with step-by-step instructions provided for new traders.