Thursday, December 11, 2008
ForexYard indicator report
| by: Forexyard Be Prepared! U.S. PPI Tomorrow at 13:30 GMT We at ForexYard encourage our customers to get involved in the most intense market events. As such, we think you should know that the U.S. PPI is expected to be released tomorrow, December 12th, at 13:30 GMT, and you need to be prepared. Market events like this one tend to create either big changes to current trends or push current trends even further. Generally, the Majors are the ones most affected by market events in general, but Crude Oil, Gold prices, and even the price of Silver can change dramatically in the seconds after such a publication. For more information about the U.S. PPI please read below. What is the U.S. PPI? The PPI, or Producer Price Index, is the price of finished goods and services sold by producers. The PPI is one of the measures used by the Federal Reserve to measure inflation. This is the primary indicator of inflationary growth. A figure higher than the previous month's release indicates growing inflation; meaning the price for domestically produced goods has increased. A negative number is the opposite: a decrease in the price of domestically produced goods and services signifying that growth has declined. This report is issued monthly, usually 15 days after the end of the month. The PPI is important to traders because it's an indicator of consumer purchasing power and therefore signifies the strength of the national currency. When producers charge more for goods and services, the higher costs are usually passed on to the consumer. When the national currency has gained in value and is capable of purchasing more, inflation is said to have slowed, and in some instances there is the rare occurrence of price deflation, which may actually be taking place in the United States right now. If the Report Comes In-Line with Market Forecasts Currently, the U.S. Producer Price Index is forecast to signify that producer prices have grown slightly. If this report is indeed released in-line with market forecasts it will signify that the price of domestically produced goods and services in the United States has increased. With a release of this nature, traders may witness the USD gain strength against the EUR and test the 1.2900 price level once again since it will signify that the U.S. economy is experiencing some growth. If the Report Surprises with a Contradiction to Market Forecasts As of now, the U.S. Produce Price Index is predicted to indicate that the price for U.S. produced goods and services has increased. If, however, this report indicates that the percentage month-on-month inflation rate is more negative than forecasted the result will likely convince investors that the U.S. economy is not in as good a shape as previously thought. As the USD has been bearish in recent days, a release of this kind may actually force the Dollar into a deeper bearish trend, testing the 1.3400 level against the EUR in the short-term. Labels: Forex Analysis, Forex Trend, Market Analysis, Market Trend, World Market |
posted by Matbank at 11:32 PM
