NEWS ARTICLE PREDICTION FOR MEDIUM IMPACT NEWS AS ON 28/01/13

DURABLE GOODS ORDERS (MoM)

CURRENCY: USD

IMPACT: MEDIUM IMPACT

ACTUAL>FORECAST: GOOD FOR CURRENCY

FORECAST: 1.8%

PREVIOUS: 0.8%

            This is medium impact news. The forecast and previous are released earlier, whereas the actual will be released later. Due to the actual release, if the actual is greater than forecast means the result is positive, while the actual less than forecast means the result is negative.. If the market rate is up it is good for economic health, whereas the market rate is down it is not good for economic health.

It measures the change in the total of new purchase orders placed with manufacturers for durable goods.

Durable goods are defined as hard products having a life expectancy of more than 3 years such as automobiles, computers, appliances, and airplanes.

The traders become care, because it is a leading indicator of production-rising purchase orders signal that manufacturers will increase activity as they work to fill the orders.

Durable goods order measures the change in the total value of new orders for long lasting manufactured goods, including transportation items.

A higher than expected reading should be taken as positive/bullish for the USD, while a lower than expected reading should be taken as negative/bearish for the USD.

PENDING HOME SALES (MoM)

CURRENCY: USD

IMPACT: MEDIUM IMPACT

ACTUAL>FORECAST: GOOD FOR CURRENCY

FORECAST: 0.3%

PREVIOUS: 1.7%

            This is medium impact news. The forecast and previous released earlier, whereas the actual will be released later. Due to the actual release, if the actual is greater than forecast means the result is positive, while the actual less than forecast means the result is negative.. If the market rate is up it is good for economic health, where as the market rate is down it is not good for economic health.

It measures the change in the number of homes under contract to be sold but still awaiting the closing transaction, excluding new construction.

The traders become care, because it is a leading indicator of economic health because the sale of a home triggers a wide reaching-ripple effect. For example, renovation is done by the new orders, a mortgage is sold by the financing bank, and brokers are paid to execute the transaction.

The national association of realtors (NAR) bending home sales report measures the change in the number of homes under contract to be sold but still awaiting the closing transaction excluding new construction.

A higher than expected reading should be taken as positive/bullish for the USD, while a lower than expected reading should be taken as negative/bearish for the USD.

TRADE BALANCE

CURRENCY: NZD

IMPACT: MEDIUM IMPACT

ACTUAL>FORECAST: GOOD FOR CURRENCY

FORECAST: -110M

PREVIOUS: -700M

            This is medium impact news. The forecast and previous released earlier, whereas the actual will be released later. Due to the actual release, if the actual greater than forecast means the result is positive, while the actual less than forecast means the result is negative.. If the market rate is up it is good for economic health, whereas the market rate is down it is not good for economic health.

It measures the difference in value between imported and exported goods during the reported month.

A positive number indicates that more goods were exported than imported.

Export demand and currency demand are directly linked because foreigners must buy the domestic currency to pay for the nation’s exports. Export demand also impacts production and prices at domestic manufacturers.

The trade balance defined as the difference between a country’s imports and exports. Balance of trade is the largest component of a country’s balance of payments. Debit items include imports, foreign aid, domestic spending abroad and domestic investments abroad. Credit items include exports, foreign spending in the domestic economy and foreign investments in the domestic economy. A country has a trade deficit if it imports more than it exports; the opposite scenario is a trade surplus.

The balance of trade is one of the most misunderstood indicators of the NZD, economy. For example, many people believe that a trade deficit is a bad thing. However whether a trade deficit is bad thing is relative to the business cycle and economy. In a recession, countries like to export more, creating jobs and demand. In a strong expansion, countries like to import more, providing price competition, which limits inflation and without increasing prices, provides goods beyond the economy’s ability to meet supply. Thus trade deficit is not a good thing during a recession but may help during an expansion.

A higher than expected reading should be taken as positive/bullish for the NZD, while a lower than expected reading should be taken as negative/bearish for the NZD.