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Yet another busy day awaits forex traders. Economic indicators might be overshadowed by many political events today. Here’s what’s expecting us today:

Apart from scheduled events, US President Barack Obama will make an important speech in his “State of the Union” address. He is expected to talk about the economy after one year in office. This will prbably include a special tax reduction. Almost a year ago I wrote that Obama’s stimulus plan weakens the dollar.

The World Economic Forum continues in Davos, and headlines continue to flow from there as well.

Two more political events are due in the US: Timothy Geithner continues to talk about his actions during the fall of Lehman Brothers. The  confirmation  of Ben Bernanke’s second term is also pending approval.

German Unemployment Change will move the Euro. In the past few months, this important indicator exceeded expectations and helped the Euro. Tomorrow we have the all-European unemployment rate. For more on the Euro’s events, see the EUR/USD forecast.

Also in Europe, Consumer Confidence is expected to edge up to -15.  Casey Stubbs sees EUR/USD consolidating and waiting for a breakout.

American Core Durable Goods Orders are predicted to rise by 0.4% after a surge of 2% last month. Durable Goods Orders are predicted to keep turn from negative to positive, jumping 2.1%.

American Unemployment Claims are expected to get back to normal, after a rise to 482K last month. A drop back to 451K is now predicted.

In New Zealand, Building Consents and Trade Balance are both released together, with the latter expected to show a squeeze of the deficit to 115 million.  Australia’s CB Leading Index might help the Aussie after the good CPI result. This comes before next week’s rate decision.

In Japan, Household Spending is expected to rise by 1.6% (annually) but the Tokyo Core CPI is expected to remain deflationary at annual rate of 1.8%. In the Japanese rate decision, the BOJ talked about less deflationary fears. Traders of the Yen will get to see the insights of the meeting with the release of the Monetary Policy Meeting Minutes. Also note the Japanese Prelim Industrial Production which is expected to rise by 2.5% this time.

That’s it for another busy day in forex trading.

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