Although we have a raft of fundamental items on the economic calendar for the euro to dollar in today’s daily currency news the vast majority relate to the US with only 3 medium tier releases for Europe.  The first of these was German Retail sales which came in worse than expected at -1.5% against a forecast of 0.0%; Final Manufacturing PMI too came in worse than expected at 49.5 versus a forecast of 50.2 & finally the unemployment rate which did manage to come in on target at 9.6%.  All three items painting a picture that economic recovery in Europe is still in a fragile state.

The markets then turn to the US where we have no less than 10 items of data & two speeches.  In no particular order of importance these kick off with the year on year Challenger job cuts which measures the change in the number of job cuts announced by employers and the forecast is for -13.8 against a previous of -5.7 and gives an indication of the scope and depth of the unemployment problem in the US.  This number is likely to reinforce yesterday’s bad ADP figure which showed the US private sector continuing to cut payrolls.   This release is quickly followed by the Unemployment Claims which measures the number of people who filed for unemployment insurance for the first time during the past week and the forecast here is for 532k and despite being a lagging indicator traders watch this figure as it provides an insight into the overall health of the economy.   Next we have the Core PCE Price Index which is forecast at 0.1%, Personal Spending data forecast at 1.2% and Personal Income data forecast at 0.1%.  At 14.00 GMT Ben Bernanke is due to testify on financial regulation before the House Financial Services Committee.  His testimony comes in two parts: the first is a prepared speech which is made available on the FED’s own website at the start and this is followed by a question and answer session.  It is at this point that we can expect a degree of market volatility.

At 15.00 GMT we have the ISM PMI figures which are expected to come in at 53.9 (anything over 50 is considered expansion) which is released at the same time as the Pending Home Sales which are forecast at 0.9% against a previous of 3.2%.  Finally we have Construction Spending, ISM Manufacturing Prices, Natural Gas Storage and Total Vehicle Sales.  The day rounds off with another speech from FOMC member Dennis Lockhart to the State College School of Business in Macon on the economic outlook and financial conditions.  All in all a day in which the markets will be able to judge the depth (or otherwise) of the economic recovery in the US and whether this recovery is likely to be consumer led given the levels of unemployment.  For currency traders the day could also indicate just how low the dollar is likely to go.

You can keep up to date with all the latest fundamental news on the economic calendar, latest currency news and live currency charts by simply following the links.  I have also included details on an excellent ECN broker.