Forex Daily Outlook – September 27 2010

We start the week with several interesting speeches (ECB) President Jean-Claude Trichet, deliver opening remarks testified before the Committee on Economic and Monetary Affairs of the European Parliament, and in Japan Governor Masaaki Shirakawa. L’ets see what awaits us today.

In Europe, European Central Bank (ECB) President Jean-Claude Trichet deliver opening remarks at the 13th Conference of the ECB-CFS Research Network on “Macro Prudential Regulation as an Approach to Contain Systemic Risk” in cooperation with the Center of Economic Policy and Research, in Frankfurt and also testified before the Committee on Economic and Monetary Affairs of the European Parliament, in Brussels, and volatility is often experienced during his speeches as traders attempt to decipher interest rate clues.

Also in  Europe, M3 Money Supply shows a rise of 2% in the total quantity of domestic currency in circulation and deposited in banks. It’s positively correlated with interest rates – early in the economic cycle an increasing supply of money leads to additional spending and investment, and later in the cycle expanding money supply leads to inflation.

Finally in Europe, Private Loans increased by 0.3% and Borrowing and spending are positively correlated – consumers and businesses tend to seek credit when they are confident in their future financial position and feel comfortable spending money

For more on the Euro, read the  EUR/USD forecast and Casey Stubbs’  latest analysis.

In Japan, Bank of Japan (BOJ); Governor Masaaki Shirakawa deliver speeches at the Japan Society of Monetary Economics Autumn Meeting, in Kobe and  also at a meeting with business leaders, in Osaka; and volatility is sometimes experienced during his speeches as traders attempt to decipher interest rate clues.

More in Japan, Trade Balance, the Difference in value between imported and exported goods during the reported month decreased by 10T and Export demand and currency demand are directly linked because foreigners must buy the domestic currency to pay for the nation’s exports. Export demand also impacts production and prices at domestic manufacturers

That’s it for today. Happy forex trading!

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