Euro steadies as US yields ease: how to read the economic calendar

The euro held its ground against the US dollar on Thursday. The ECB reference rate for EUR/USD on 8 October was 1.1186, up 0.08% from 1.1177 the day before, as a pullback in US Treasury yields cooled the dollar's momentum, according to FXStreet. FXStreet adds that French fiscal concerns and broad dollar strength still keep the euro near the 17-month low it touched earlier this week.

The day was busy with scheduled news. Earlier, investingLive's European session wrap reported US 10-year yields up 6 basis points to 5.345%. Then came US jobs and inventory data, plus the ECB's account of its September meeting. Yields eased later in the American session, FXStreet reports. For more on the euro's week, see this fxcash.com piece on the euro steadying as US yields pull back. You can follow the pair on a EUR/USD chart.

What is the economic calendar?

An economic calendar is a schedule of planned events that can move markets. It lists data releases, such as jobs or growth figures, and central-bank events, such as meeting minutes or speeches.

Most calendars show three numbers for each data release:

• Prior: the last reading.
• Expected (or consensus): what economists forecast.
• Actual: the new figure.

Markets usually react to the gap between actual and expected, not to the number alone. A strong figure that was already expected may barely move a currency. A surprise can move it fast.

A worked example

Here is how Thursday's calendar looked, using the releases reported by investingLive. Its morning preview, What are the main events for today?, flagged a speech by Fed Governor Waller and the ECB meeting minutes.

Jobless claims. Actual minus expected: 197,000 − 200,000 = −3,000. That is 3,000 ÷ 200,000 = 1.5% fewer claims than forecast. Fewer claims means a stronger job market. investingLive notes that claims remain near multi-generational lows and called them a sign the Fed has room to hike rates.

Wholesale inventories. 0.5% − 0.7% = −0.2 percentage points below forecast. investingLive said this would trim third-quarter GDP trackers slightly. Soon after, the Atlanta Fed GDPNow estimate dipped from 3.7% to 3.6%, a fall of 0.1 point.

The ECB account. The ECB published its account of the 9-10 September meeting. Nordea's Jan von Gerich, quoted by FXStreet, read it as supporting further rate hikes, likely in December and March.

The currency result. The EUR/USD fixing moved from 1.1177 to 1.1186. That is 1.1186 − 1.1177 = 0.0009, or 9 pips. As a percentage: 0.0009 ÷ 1.1177 ≈ 0.08%. Compare that with the range over the last five fixings: from a high of 1.1269 on 6 October to a low of 1.1177 on 7 October, a gap of 92 pips. A day full of events ended with a small net change at the fixing.

Why it matters for new traders

Scheduled events can cause sudden price jumps. Spreads, the gap between buying and selling prices, can widen around big releases. Knowing the time of a release helps you avoid being surprised.

The calendar also helps you explain a move after it happens. Thursday shows that mixed news can cancel out: a firm jobs figure and a softer inventories figure arrived on the same day.

Finally, remember that ECB fixings are set once per business day. They will not show every swing that happened around a release.

Key terms

• Economic calendar: a schedule of data releases and central-bank events.
• Consensus: the average economist forecast for a release.
• Surprise: the difference between the actual figure and the consensus.
• Basis point: one hundredth of a percentage point (0.01%).
• Meeting account (minutes): a written summary of a central bank's policy discussion.
• Reference rate (fixing): an official daily exchange rate, not a live quote.