An economic calendar is a very useful tool in fx analysis to register profits as the markets react to current events and government announcements. A recent example is how the United States Dollar soared on Friday June 7, 2013 due to a strong jobs report that topped the expectations of the Wall Street community. Two days earlier, Kansas City Federal Reserve Chairman Esther George stated in a prepared remarks press release for an upcoming speech that she favored ending Quantitative Easing III due to improving economic conditions in the United States.

As the chart below shows, the United States Dollar soared on Friday June 7 after dropping after the release of George’s remarks on Wednesday June 5.

The drop was due to investors fearing that the ending of Quantitative Easing III would be bearish for the American economy due to reduced liquidity that would send interest higher and the stock market lower. Since November, the stock markets are up more than 20%. The US Dollar is also stronger as a result of Quantitative Easing III.

Forex traders who knew that the jobs report was coming out Friday could have profited from the public remarks of Federal Reserve President George. A public statement that the economy was improving with a jobs report due when a high ranking Federal Reserve official is making the remark is a solid indicator. Fundamental analysis would have produced data to support a position that a bullish jobs report was to be expected.

There are many more of these events during the year on the economic calendar. It is not just those of the United States that drive the foreign currency markets, although as the world’s largest economy it is the global leader. Due to the quantitative easing measures of the Bank of Japan its economic calendar has assumed greater significance. The same is true with China, as its economic reports are almost as significant as those of the United States due to its impact on global commodity markets.

For both foreign exchange speculators and traders, the economic calendar is a public document that can result in profits or losses, depending on how it is utilized. Following the remarks of officials closely as key dates approach can result in easy profits that are perfectly legal. Most importantly, the events of the economic calendar can provide direction as to the trends of the market, which has proven to be profitable for the most successful foreign currency investors.