Forex Daily Outlook – December 29 2010

German Prelim CPI in Europe and KOF Economic Barometer in Switzerland are only some of the events for today .Let’s see what awaits us.

In Europe, German Prelim Consumer Price Index (CPI) of goods and services purchased by consumers is about to rise by 0.8%.Inflation is important to currency valuation because rising prices lead the central bank to raise interest rates out of respect for their inflation containment mandate.

Also in  Europe, M3 Money Supply, total quantity of domestic currency in circulation and deposited in banks is about to rise by 0.6%. It’s positively correlated with interest rates.

Finally in Europe, Private Loans, new loans issued to consumers and businesses in the private sector is about to rise by 0.52%. Borrowing and spending are positively correlated

For more on the Euro, read the  EUR/USD forecast.

In Great Britain, Housing Equity Withdrawal, new home-secured loans that are not used for home purchases or improvements; is about to rise by 0.7B. Released quarterly.

Read more about the Pound in the  GBP/USD forecast.

In Switzerland, KOF Economic Barometer, index based on 12 economic indicators. This index is designed to predict the direction of the economy over the following 6 months and it is about to be 2.08 points.

In Japan, Manufacturing Purchasing Managers’ Index (PMI);   Survey of about 300 purchasing managers which asks respondents to rate the relative level of business conditions including employment, production, new orders, prices, supplier deliveries, and inventories indicates contraction with 47.3 points.

That’s it for today. Happy forex trading!