Rate decisions coming from the Fed, BoE and ECB
Economic calendar summary
A busy week for central banks kicks off Wednesday with the final FOMC meeting of the year. With rate holds expected from the Fed, BoE and ECB, markets are already speculating what's in store for 2024. Traders will focus on comments from central bank leaders speaking to future expectations, specifically when rate cuts will begin.
For forex pairs, shifting interest rates will be a strong driver for demand in 2024 and it is still unclear which major central bank will be the first to cut rates.
Core Inflation Rate - US
Time: 8:30am ET Tuesday, December 12th
Previous: 4.0%
Expected: 4.0%
Though a timely release one day before the FOMC meeting, this CPI reading is unlikely to shift expectations over interest rates. Even if inflation is unchanged from last month's reading, 4.0% remains the lowest level of core inflation since 2021 - speaking to the continued effect of this year's interest rate hikes.
Interest Rate Decision - US
Time: 2:00pm ET Wednesday, December 13th
Previous: 5.5%
Expected: 5.5%
The Federal Funds Rate will almost certainly remain unchanged at the final FOMC meeting of the year, shifting focus to Fed Chair Powell's comments following the meeting (2:30pm EST). Markets are eager for guidance on the Fed's 2024 projections - specifically wondering when the first interest rate cut will be. Any strong language from Powell will likely send price action into US dollar pairs.
Interest Rate Decision - UK
Time: 7:00am ET Thursday, December 14th
Previous: 5.25%
Expected: 5.25%
The Bank of England (BoE) is expected to hold rates constant for the third consecutive meeting as the central bank looks now to rate cuts in 2024. Last meeting saw 3/9 members vote for a rate hike - traders will likely analyze voting patterns at this meeting to gauge the bank's sentiment going into the new year.
Interest Rate Decision - Euro Area
Time: 8:15am ET Wednesday, December 14th
Previous: 4.5%
Expected: 4.5%
The European Central Bank (ECB) is unlikely to deviate from other central banks in holding rates steady as Eurozone inflation dipped to 2.4% in November. Traders will analyze differences between statements from the ECB and the Fed that could send speculative price action into EUR/USD Thursday morning.
Retail Sales - US
Time: 8:30am ET Thursday, December 14th
Previous: -0.1%
Expected: -0.1%
November retail sales in the US are expected to decline slightly month-over-month. A second consecutive decline could lead traders to believe a trend is approaching while a positive reading could mean October's downturn was unrepresentative of the US's strength.
How to trade economic events
- Open an account to get started, or practice on a demo account
- Choose your forex trading platform
- Open, monitor, and close positions on forex pairs
Trading forex requires an account with a forex provider like tastyfx. Many traders also watch major forex pairs like EUR/USD and USD/JPY for potential opportunities based on economic events such as inflation releases or interest rate decisions. Economic events can produce more volatility for forex pairs, which can mean greater potential profits and losses as risks can increase at these times.
You can help develop your forex trading strategies using resources like tastyfx’s YouTube channel. Once your strategy is developed, you can follow the above steps to opening an account and getting started trading forex.
Your profit or loss is calculated according to your full position size. Leverage will magnify both your profits and losses. It’s important to manage your risks carefully as losses can exceed your deposit. Ensure you understand the risks and benefits associated with trading leveraged products before you start trading with them. Trade using money you’re comfortable losing.
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