With precious little fundamental news on the economic calendar today for Europe and none at all for the US markets are taking a breather and waiting to decide whether last week’s favourable NFP data is really the start of a long, slow recovery back to economic health.  The only items of news in Europe have been French Industrial Production which came in better than expected along with the Sentix Investor Confidence number which too came in better than expected at -17 against a forecast of -26.   As always the markets have to decide between risk appetite or risk avoidance and market mood can often be found in correlated or related markets.  For this week it will be whether the 10 yr bond yield continues to rise and test the 4% level, last seen in early June, as investors take their money into riskier assets.   On such decisions will also rest the fate of the US Dollar which did not weaken last Friday on rising equities as the market perhaps starts to take the view that with the US inching back into growth the FED will need to start thinking about interest rates once again.  This week’s FED meeting and raft of data from China should provide the forex market with plenty to think about.

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The most important piece of fundamental news on the economic calendar for today is the release of the ADP data in the US this afternoon, which is a pre-cursor to the Non Farm Payroll figures released by the Department of Labor on Friday. The data is derived from payroll information collected by Advanced Data Processing, one of the largest payroll processing companies in the US, who provide their services to many of the largest corporations, and based on the changes in the number they then provide an estimate of the change in the employment numbers during the previous month. This data is released two days ahead of the NFP, but since its inception 3 years ago has tended to provide a relatively good guide to the more important NFP data set, and is therefore an important number for traders to watch today. The forecast is for a figure of -351,000 which is significantly better than last time at -473,000, and should the numbers be better than expected then a surge in equity markets could spell more trouble for the battered US dollar once again.

Two hours after the ADP numbers we have yet another diffusion index ( an important one this time), namely the Non Manufacturing PMI data released by the Institute of Supply Management ( ISM). The index is based on a survey of around 400 purchasing managers, which asks for their views on the current economic climate, particularly with regard to new order, prices, suppliers etc. Any figure above 50 indicates an industry in expansion and below is in contraction. The forecast for this afternoon is 48.1, an improvement on last month at 47.0. This release is combined with Factory Orders, and followed shortly afterwards by the Oil Inventories which are expected to show a further build of 0.9m barrels.  This data tends to have a muted effect on the US dollar but is more pronounced on the Canadian Loonie due to the latter’s pre-eminence as an oil producer in the energy complex.

The only significant item of news for Europe this morning is the retail sales figures which are forecast to show an improvement from the previous at 0.3% with last month’s figures showing a decline of -0.4% so further goods news for the Euro should these numbers be achieved.

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.

A busy week for fundamental news on the economic calendar this week for the euro to dollar, with ADP in the US on Wednesday, followed by an ECB decision on Thursday and, of course, ending the week with NFP on Friday, so a hectic  week  of news!  This morning the news started early in Europe with the release of the German Retail Sales figures which came in worse than expected at -1.8% against a forecast of 0.4%. denting any hopes of a speedy economic recovery and worse than last month’s figures, so despite some positive news from Germany in the last few weeks this has taken the gloss off the recent rosy picture.  This was followed by the final manufacturing PMI data (yet another diffusion index) which was marginally better than expected at 46.3 against a forecast of 46, which completed the news for Europe.  We are now awaiting the most important number for today, which is the equivalent in the US, issued by the ISM and forecast at a very similar level to that of Europe at 46.4.  Allegedly if the actual is better than forecast then this is supposed to be dollar positive, however, current market sentiment is very much focused on risk appetite.  If the number is higher than expected then investors will more likely turn to riskier assets, such as equities which will be at the expense of the US Dollar.  In addition to the above we also have some minor data including construction spending, ISM manufacturing prices, and finally vehicle sales all of which should give the market an indication as to whether the US government monetary stimulus plan is in fact beginning to work.

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.