Employment Indicators

The employment rate directly influence the country economy contraction, consumer spending, etc. Recession of employment rate will impact psychological confidence indicators and hence potentially increase criminal rate. The employment reports are significant to the financial markets in general and to forex in particular. This indicator is importance because it is align with the health of economy and maturity of business cycle.

Consumer spending indicators. Products sales are a significant consumer-spending indicator for forex traders, as it proves the strength of consumer demand as well as consumer confidence. CSI will induce high economical growth in a country and hence currency will be increase. In Forex, traders need to analyze data such as the unemployment rate, manufacturing payrolls, nonfarm payrolls, average earnings, and average workweek. Generally, the most significant employment data are manufacturing and nonfarm payrolls, followed by the unemployment rate.

Employment Cost Index ( ECI ). The Employment Cost Index measures the relative changes in wages, benefits, and bonuses for a specific group of occupations. Consumer Spending Indicators show on data of the retail sale volume which is important for the Forex because it shows the level of consumers demand and their sentiments. The productivity report indicates that the ECI can reveal whether the increased cost of labor is justified or not.

Retail Sails. Retail sales are a significant consumer-spending indicator for foreign exchange traders, as it shows the strength of consumer demand as well as consumer confidence. For a well development country, consumers are playing important role in economy aspect. If the consumers have enough discretionary income to spend on their daily demand, on the other hand there will be more supply or imported goods. Forex traders may need to focus on the sales report by end of the year. In September, this is the back to school month whereas December has seasonal sales activities. Therefore, forex traders have to study the retail sales report in November. Some seasonal sales activity brings fewer profit margins and the reason is because of the discount promotion or clear stock purpose. Traders watch retail sales closely to gauge the overall strength of the economy and, consequently, the strength of the currency.

Consumer sentiment . It’s a survey of households that is designed to gauge direct the individual propensity for spending money over the past and coming year as well as the evaluation and expectation on economy outlook.

Auto sales.The level of auto sales is an economic indicator as a reference for forex traders . Car manufacturing increase country profit margin while export to overseas. When car import, tax are collected by government. The Auto sales are one the main products which can generate high income for a country and directly influence currency exchange market. But if the car does not manufacture locally, the figure cannot be take into data for forex analysis.