The data releases, influential speakers and other potential moving events of the day need to be kept track of by the Forex trader for the day ahead. Economic data for the Forex market is multi-dimensional. Items coming from several countries may have an effect on the ups and downs of theforeign currency market that day.
For major currencies, primarily from the industrialized countries, interest rates are quite often very influential on Forex prices. The best return is sought by capital, so the relative levels of interest rates between global currencies influences movement of capital which in turn creates supply and demand.
It must also be kept in mind that the Forex market helps facilitate trade. Anything bought and sold around the world, such as gas and oil requires currency transactions on some level. Thus there is more supply and demand at work.
