Important News In Fundamental Analysis

Important News In Fundamental Analysis : After learning about the functions and procedures of fundamental analysis, we know that these materials are capable of making news or fundamental analysis information. But not just any news that can be used as a starting material for the production of fundamental analysis, but the news that you have chosen.

In other words, despite all the news of a role as an important part of fundamental analysis, but not necessarily using all the latest news, in-depth analysis, select the rule, only the information deemed relevant to the situation we have to do fundamental analysis. The message is important and as material for fundamental analysis are:

Industrial production
This method measures the performance of the industry in the country. Indicator of Increased production Compared to the height of a hundred the next period. The information Obtained is that if there is an increase of economic output Showed in spirit as falling unemployment. Reducing the inflation rate rising unemployment. Higher inflation may weaken the currency. If the information is available, take a position that is open for sale. Conversely, if the output is reduced then create an open information about the location of the purchase.

Balance of trade (the trade balance)
This information Represents the difference between exports and imports of goods. Usually the trade balance with the exception of exports and imports of goods and intangible services. If the value of exports than imports, said the trade surplus. This condition causes the exchange rate to Strengthen the surplus countries. If there is no information of this type, it is recommended that an open position to buy again if the opening deficit to sell.

The producer price index (PPI Input)
The index measures changes in prices of raw materials used in production. Index shows decline in commodity prices. This in turn will reduce the cost of production. Message lower costs of production decline in inflation. During the analysis of reduction decreases the rate of inflation. So if there is news about the fall of the PPI, the recommended position is open to sell if you do not buy in the open.

The producer price index (PPI Output)
The index measures price changes made in the production of semi-finished products and finished off my output. We are more familiar with the inflation rate. Show news and then with IBP. Therefore, the recommended action is the same, ie Buying outdoors when news of production cuts PPI index.

Retail
Data for this news provides information on the number of stores that sell to consumers. By increasing the volume of sales Showed in an increase of demand. Increased demand we mean raising prices rising inflation. Occurs when inflation, the value of the currency will weaken. Results of analysis of this information in terms of an increase of in the number of retail sales, the recommended position is open for sale. Conversely, if the decline in retail sales, purchase volume open.

Unemployment (unemployment)
Unemployment Data is linked to inflation. In theory, if unemployment increases reflect low inflation. This theory is put into practice. Therefore, advertising or news about unemployment in the U.S. is still pending. Why, Because if the high unemployment rate, roomates is usually lower interest rates, the Federal Reserve (U.S. central bank) what investors are willing to invest in the real sector. On the other hand, if the interest rate is low, it will increase of inflation. They produce a weakening currency. Therefore, if we have information that the unemployment rate increases, this situation was taken out of the room. Conversely, if the unemployment rate drops to open sell.

Nonfarm wage (NFP)
This Data is the change in nonfarm wage or Announced in the industry. Wage increases in this sector Showed in the expected increase of demand indicators. In addition, the increase of in demand will increase of inflation. As usual, the inflation rate will be Weakened.

In fact, many important factors that should be Analyzed (the next article will fit in the table), especially noneconomy how the political situation in the country or abroad, government policies (domestic and foreign), geographic places (Natural Disasters). Even the terrorist attacks should be part of the information to be Analyzed. And fundamental analysis is a factor that plays an important role in currency trading.

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