Forex Daily Analysis – January 8th 2009

Big day today in the Forex market: The BOE will publish new interest rates in Britain, Ivey PMI in Canada, Unemployment Claims in the US, and many important speeches.

Oil prices fell yesterday to$42.23 after the  Crude Oil Inventories rose to 6.7M, much higher than expected. This large storage of oil eases oil prices, and weakens the Australian and Canadian dollars.

This comes despite the continuation of the Gaza war, with rockets fired from Lebanon on Israel this morning. Another front in the middle east could send oil prices back up.

Forex Data Today

The day began with bad data from Australia: the monthly Building Approvals fell 12.8%, much more than a drop of 1.4% that was expected. Also Australia’s positive Trade Balance dropped. AUD/USD trades now at 0.7057

In Switzerland, the monthly CPI is expected to drop by 0.4%, and Unemployment Rate is expected to be at 2.8%.

In the Euro zone, German Trade Balance, Consumer Confidence, and Unemployment Rate will impact Forex trading, although this data is final and not so fresh.

And at 12:00 GMT, in Britain, the MPC Rate Statement will include the Official Bank Rate. The BOE is expected to cut the rate to 1.50%, but some traders are expecting a sharper cut in rates. All eyes will be with Mervyn King.

Later on, the weekly Unemployment Claims will be published in the US. It’s expected to be at 545K, after last week’s good surprise.

In Canada, the important Ivey PMI is expected to be low, at 37.5. If this isn’t enough from Canada,  Gov Council Member  Pierre  Duguay will speak later on, and will shed some light on the Canadian economy.

Speaking about speeches, also  President-Elect Obama will speak about the economy, less than two weeks before entering the White House.

And in Europe, Jean Claude Trichet will talk about the Euro-zone.

Lots of raw data and lots of talks today.

Happy Trading!