Interest Rates

If a country raises its interest rates, the currency of that country will strengthen in relation to other countries, as investors shift assets to that country to gain a higher return. Similarly if a country lowers its interest rate, the investors may take out their money and invest in another currency. This would weaken the former currency.

Non Farm PayRoll

Non Farm Payroll employment is one of the primary monthly indicators of aggregate economic activity because it encompasses every major sector of the economy.
Large increases in payroll employment are seen as signs of strong economic activity that could eventually lead to higher interest rates that are supportive of the currency. The unemployment rate is a strong indicator of a country’s economic strength. When unemployment is high, the economy may be weak – and hence its currency may fall in value.

Consumer Price Index

The Consumer Price Index (CPI) is a measure of the average level of prices of a fixed basket of goods and services purchased by consumers. The CPI is a primary inflation indicator because consumer spending accounts for nearly two-thirds of economic activity.

Producer Price Index

The Producer Price Index (PPI) is a measure of the average level of prices of a fixed basket of goods received in primary markets by producers. The monthly PPI reports are widely followed as an indication of commodity inflation.

Durable Goods Orders

Durable Goods Orders are a measure of the new orders placed with domestic manufacturers for immediate and future delivery of factory hard goods.

Gross Domestic Product

Reported quarterly, GDP growth is widely followed as the primary indicator of the strength of economic activity. A high GDP figure is often associated with the expectations of higher interest rates.

Retail Sales

Retails Sales are a major indicator of consumer spending because they account for nearly one-half of total consumer spending and approximately one-third of aggregate economic activity.

Housing Starts

Housing Starts are a measure of the number of residential units on which construction is begun each month. The indicator is followed to assess the commitment of builders to new construction activity. High construction activity is usually associated with increased economic activity and confidence, and is therefore considered a harbinger of higher short-term interest rates that can be supportive of the involved currency at least in the short term.

Trade Balance

The trade balance is a measure of the difference between imports and exports of Tangible Goods and Services of a country. Imports and Exports are important indicators of overall economic activity of a country.