2016 is expected to be a challenging year for the forex market, as diverging monetary policies, weak commodity prices and uneven global growth dictate the performance of many global currencies. However, with great challenges come great opportunities. With the right strategies in play, forex traders can achieve great success over the next 12 months. To help you start the year on solid footing, we provide a brief recap of the top forex events of January. Circle these dates because they are expected to have a significant impact on global currencies.
January 3: China manufacturing PMI (Dec)
Forex traders can expect to see two important Chinese manufacturing reports on January 3. Both have significant implications on global currency flows because they provide a detailed snapshot of the Chinese manufacturing sector, which contracted sharply in the latter half of 2015.
January 5: Eurozone CPI inflation (Dec)
One month after the European Central Bank (ECB) expanded its stimulus program, forex traders will be looking to see whether the new measures have had any impact on inflation. Although it will probably be too early to tell, the December inflation report could dictate whether the ECB decides to ease monetary policy further in the short term.
January 8: US nonfarm payrolls (Dec)
The US government will release one of the biggest economic reports of the month on January 8. Nonfarm payrolls is a closely followed indicator of the US economy. Another solid month of job creation in December could push the US dollar higher across the board. That’s because the performance of the US labour market is closely tied to expectations about monetary policy.
January 10: China CPI and PPI inflation (Dec)
Chinese data take centre stage again in the second week of January. Another deterioration in both producer and consumer prices will raise the specter of another rate cut by the People’s Bank of China, which has already slashed interest rates five times since November 2014.
