A busy day of fundamental news on the economic calendar across many currency pairs including the euro to dollar, and the news started early this morning with the German final CPI month on month figures which came in as expected at -0.1%.  The figures indicated that German consumer prices showed no change in May, the first time since 1987 and as a result Europe’s largest economy officially recorded 0% inflation suggesting once again that deflation may still be a bigger problem than inflation and highlighting the dilemma for investors which has triggered much of the volatility of the last few days.  This was followed by both the French and Italian industrial production figures, the first of which came in worse than expected at -1.4% versus a forecast of -0.3% and the second of which came in better than expected at 1.1% against a forecast of 0.3%, so a mixed picture.   Later this morning we are expecting a speech from BUBA President Axel Weber, who is due to speak at a Financial Times in Frankfurt.  Although the topic is unknown interestingly it is also a tentative piece of news, which could signal more significant especially as Weber is a voting member of the ECB.

Moving to the US scene the key data this afternoon are the trade balance figures which are forecast at -28.8bn and it is widely expected that the US trade deficit will have widened for a second consecutive month in April, largely driven by increasing energy costs.  The figure represents the difference in value between imported and exported goods and services with a positive figure indicating that more goods were exported than imported, and vice versa.   Export demand and currency demand go hand in hand as foreigners have to buy the domestic currency in order to pay for exports.

Finally in amongst a plethora of more minor announcements we  have crude oil inventories which as always tends to have a stronger impact on the usd/cad and also the cad/yen which correlates positively with crude oil prices.  In addition we also have the Beige Book (data used by the FMOC to help them make interest rate decision), Federal Budget Balance and last of all a speech from FOMC member Elizabeth Duke – so a very busy afternoon and evening.

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.