A plethora of fundamental news due for release today affecting both the Euro and US dollar.  The day kicks off in earnest with the ECB monthly bulletin which has just been released and is a report revealing the data used by the board in reaching its latest interest rate decision and is always released 7 days after any interest rate announcement.  Yesterday’s horrendous German factory orders which came in at -8%, far worse than anticipated, actually had the opposite effect on the Euro which promptly rose by almost 200 pips on overnight trading indicating the almost random nature of the markets at the moment and therefore making trading extremely difficult.

Continuing with the German theme we have industrial production figures due at 11.00 am GMT with a forecast of -3.3% against a previous of -4.6%.  These figures measure the change in the total inflation adjusted value of output produced by utilities, mining and manufacturing and if the actual is better than forecast then, in theory, this should be positive for the Euro, but following yesterday’s debacle anything could happen.  It is generally considered a leading indicator.

An hour later we have the omnipresent Monsieur Trichet who is due to utter in Vienna at the Bank of Russia seminar.  As always his comments are likely to affect the euro in particular and expect to see some market reaction.  Half an hour into his speech the retail sales figures in the US will be released which in terms of economic news are considered a “red flag” indicator – ie have the potential to cause market volatility.   Forecast for -0.5% against a previous of 1% so clearly the market is anticipating a further decline.  At the same time we will have the unemployment claims in the US which are expected to worsen further to 642K.  This is the increase in the number of people claiming unemployment insurance for the first time in one week.

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Business inventory data is also due for release and measures the change in the total value of goods held as stock by manufacturing, wholesaling and retailing.   Forecast is for -1.2% against a previous of -1.3%.  The final element of economic news is a speech by the new Treasury Secretary Geithner who is due to testify before the Senate Budget Committee and, as always, his comments will be closely watched by the markets for any clues of future policy but given the current state of the global economy it is unlikely that his speech will reveal anything new.  However, the last time Mr Geithner spoke at any length the markets promptly fell – raising suspicions that he may have the same detrimental effect as his predecessor, the late and not lamented, Henry “Hank” Paulson.