On the upcoming economic calendar for Thursday, January 15th there are four key news items to be aware of.
At 07:45 the Euro-zone will be releasing the minimum bid rate, or in other words, there interest rate. The interest rate sets the tone for mortgages, commercial loans, and all economic lending criteria. This is the single most important reason why currencies are bought and sold. A strong interest rate and robust business cycle will attract foreign investment. A weak interest rate will normally lead to a weak currency as investors swap the higher yielding currency for a profit. Many analysts are expecting the ECB to cut 50 basis points to 2.00 percent. Approximately 45 minutes later the ECB will be holding a press conference which will detail the decision.
Also at 08:30 the United States will be releasing the producer price index as well as the weekly unemployment claims. The producer price index measures the rate of inflation of manufacturers when purchasing goods and services. It is considered to be a leading indicator of consumer inflation because as producers pay more for their goods and services they then pass along the higher costs to the consumer in the form of higher prices. Economists are expecting the PPI to decrease to -2.2 percent. This is in large part due to the decrease seen in fuel prices.
The U.S. will also be releasing their weekly report on unemployment claims with analysts expecting a reading of 512K. This release measures the number of jobs created, or the percentage of employed/unemployed in the labor market. A currency will strengthen or weaken in-line with the other releases that the employment data impacts, rather than as a knee-jerk reaction to these numbers printing.
These four major releases will be within an hour's time of each other, extreme volatility can be expected.