Gross Domestic Product is usually considered as the best, broadest and the most comprehensive tool to assess the economic status of a country. It takes into account the total of all market prices on the ultimate goods and the services produced domestically during a particular period of time. An increasing GDP of a country shows its improving economic standard and this will of course attract the tourists or the foreign investors to get into the country’s stock markets and bond markets. It is not so rare to seek hike in rate of interests following the GDP rise, as the central bank would feel more confident in their growing economic value. The compilation of both the GDP rise and high interest rate will lead to the rise in demand for the currency of nation globally.
French Nonfarm Employment
Nonfarm Employment Change is a good tool to measure the number of fresh jobs created in a previous quarter (excluding farming associated employment). New jobs in an economy largely influences the strength of the currency of the nation as the new jobs directly drive on consumer spending, which in turn spend on almost half of the gross domestic product. GDP as a vital indicator of economic development in regards of increasing economic level and increase in nation’s currency.
CPI implies Consumer Price Index, a basic indicator that shows the rate of inflation or rise in price as observed by consumers while purchasing services and goods. It is a timely and details indicator of inflation. Rising trend in the consumer price index would impact a nation’s currency in a positive way. Central banks concern mostly about the price stability. If inflation is on a steady rise, then interest rates would also hike off so as to bring down the prices. Increases rates of interest would entice inflow of foreign investment which in turn would rise up the demand and the stand of the currency in an international scale. Consumer index is a well respected indicator in terms of its market potential.
Gross Domestic Product is conceived by most of the people as a broadest and comprehensive tool to check out the economic condition of a country in general. It measures the total of all the market values on the final services and goods produced domestically in a country during a particular period of time. An increasing trend in the GDP of a country indicates that improving nature of the country as a consequence of the investments of the foreign business men within the stock markets and the nations bonds. It is not so rare to observe interest hiking as a result of the increasing GDP. This is because when the economy seems to be good, then central banks will also develop a strong confidence in themselves. This will then cause a rise in demand for the nation’s currency at a global level.
German IFo Business Climate Index
IFO [Information and Forschung] Business Climate Index would survey manufacturing, production in both wholesale and retail and also the construction of firms in an attempt to check out the economic trust in the awaiting months. Thus about 7,000 firms are expected to participate in the survey and it clearly points to the economic confidence or rather a lack of the same in the German economy.
German Industrial Production
Industrial production is a tool to measure the dollar value of a product manufactured in the factories or other production amenities. Increased manufacturing of products also signify an economy which is strengthening day by day and such a trend will soon effect the position of a country’s currency positively. Industrial production process is closely connected to the personal income, average level of earnings; increase employment opportunities etc and any slight reaction to the business will lead to a peep through these blink ants.
German Manufacturing PMI
PMI refers to Purchasing Managers Index. Before report is put out ,purchasing managers keep a survey on the present situation of the economic factors which is relevant to the position that include orders, production, inventories, employment etc. Business people always keep an eye on this index as it will tend to a data that may release later. The reason for this is the crucial analysis of purchasing g managers on the performance of the production company. Usually the indicator uses a 50 grade for measuring the expansion and a reading above this shows an economic expansion.
German ZEW Economic Sentiment
ZEW refer to the Zentrum fur Europaische Wirtschaftsforschung; though it may be an irrelevant fact in regard to non German speaker. At any cost, the economic sentiment of ZEW always takes a look at the sentiment of investors at even global level… those Participants in the data collection states whether they experience pessimistic or optimistic regarding their investment state and economy health in the 6 months, before them. The indicators usually equates the percent of investors who always feel positive regarding the pending economy and those feel negative and then the factors the figure of those who expects nil change. If 40% of these investors feel affirmative concerning the economy which is pending and 30% expects a declining economy leaving the remaining 30% to expect no change, the rate reading will be + 10. Investor sentiments, particularly those at the institutional level can largely affect overall felling of economy, therefore the positive indicator would positively affect the economy in an ultimate sense.
Industrial New Orders
Industrial New Orders is simply the measurement of number of purchase orders which is new and as seen by the domestic manufacturers for durable or either non-durable goods in a prescribed period of time.
Interest Rate Statement
The Governing Council of the European Central Bank (ECB) is publishing a monthly statement of Interest Rate. Behind every economic indicator may be perhaps, those who relate to the decisions on interest rates. Actually many would argue that the economic indicators are used by those average trading people for whom nothing exceeds better than pending rates of interests and changes in it. In fact the body of the statement consists of a good explanation of different economic factors that has its effects on rate changes in terms of short term rate of interest of a nation. This rate is otherwise referred as cash rate. In a sense, this report also torches its light to what the next interest decision will be. The interest rates usually for the short term are only of monumental importance in the case of any major fiscal markets. This is because of the fact that the high rates mainly attract the foreigners who seek the highest return possible in exchange of lowest risk which is possible. The price stability is mainly concerned of by the central banks .once inflation increases continuously, then to bring down the prices, interest rates will also increase as already mentioned. Internationally, the rising rates of interest are said to tempt upon the investment flow, which may probably then raise the demand of the currency. Seasoned economy dealers are the ones who understand this relation in a most good manner.