3 Most Leading Forex Essential Indicators
There are thousands main indicators accessible to the Forex traders at this moment. If you figure all of them only for the major currency pairs you’ll get more than a hundred noticeable indicators – macroeconomic, monetary, economical, financial, weather-based, etc.
For few traders it’s sophisticated to follow all of them, as it requires time and efforts in addition to the demand to review about the impact of all these basic indicators on various currency pairs. This article lists 3 most substantial (in my humble conclusion) fundamental indicators that have the highest effect on the currency rates and are quite easy to follow as they are reported not so often.
GDP or Gross Domestic Product is the main indicator of the macroeconomic strength of the country. The growth of GDP signals a stronger economy and a more competitive currency because the global investors will have to buy this currency in order to invest in this country, and they will want to invest in it because its economy is growing.
Interest Rates are set by the world’s central banks and are the main tools of the monetary regulation. Higher interest rates provide more value to the affected currency, while the lower interest rates decrease the value of the currency. Interest rates are usually revised every month or two during the special monetary policy meetings of the central banks.
Unemployment Rates are influential indicators both for currency traders and for the monetary authorities when they set the interest rates. Non-farm payrolls are considered to be the most important of the unemployment indicators in USA and they are released monthly.
In several cases it’s rather to be up to date with these essential indicators to review the possible market trends in Forex. But, of course, if you wish to get a more detailed picture you shouldn’t limit yourself only with these indicators, especially if you pose yourself as a pure fundamental currency trader.
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