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Forex Journal Team

June 8, 20261 min read

Economic Indicators Every Trader Should Understand

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Key Economic Indicators

Most Market-Moving Reports

Non-Farm Payrolls (NFP) — First Friday of every month. The single biggest market mover. Shows US employment change. CPI (Consumer Price Index) — Monthly inflation data. Directly impacts interest rate expectations. GDP — Quarterly. Measures economic growth. Above 2-3% = strong economy. Interest Rate Decisions — Central bank meetings (Fed, ECB, BOE, BOJ). Most anticipated events in forex. Retail Sales — Monthly. Shows consumer spending health. PMI (Purchasing Managers Index) — Monthly. Manufacturing and services sector health. Above 50 = expansion, below 50 = contraction.

How to Trade News

  1. Know the schedule — Check an economic calendar daily
  2. Expect volatility — Spreads widen, price moves fast
  3. Two approaches:
- Before the news: Position based on expectations

- After the news: Wait for the initial spike to settle, then trade the follow-through

  1. Use wider stops — Normal stop distances will get hit by volatility
  2. Reduce position size — Risk less than usual during news

Pro Tip

You don't have to trade news. Many successful traders step away during high-impact releases and wait for the dust to settle.

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Written by Forex Journal Team

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