How to read an economic calendar: actual, forecast, previous and impact

An economic calendar lists scheduled data releases and central bank events, with the time, the country and the numbers traders compare. Checking it before you trade is the simplest way to avoid being surprised by a sudden move.

The columns

• Time: when the figure is published. Good calendars convert it to your time zone; FTC's economic calendar does this automatically.
• Currency or country: which economy the release belongs to, and therefore which currency it is most likely to move.
• Event: the indicator, such as CPI, non-farm payrolls, retail sales or a rate decision.
• Impact: usually shown as low, medium or high. It reflects how much the release has historically moved markets.
• Actual: the figure as released.
• Forecast or consensus: the median expectation of economists surveyed before the release.
• Previous: the figure from the last release, sometimes marked as revised.

What actually moves the market: the surprise

Markets price in the forecast before the release. The price reaction comes from the difference between the actual figure and the forecast, not from whether the number is good or bad in absolute terms.

A jobs report showing 150,000 new jobs can push the dollar down if 250,000 were expected, and up if 50,000 were expected.

Read the details, not only the headline

• Revisions. A strong headline paired with a large downward revision to the previous month often produces a move that reverses.
• Core versus headline. For inflation, traders often focus on core measures that exclude food and energy.
• Several numbers at once. The US jobs report includes payrolls, unemployment and wages; they can point in different directions.

Common release times

• US data from the Bureau of Labor Statistics, including CPI and payrolls: 8:30 a.m. New York time
• Federal Reserve decisions: 2:00 p.m. New York time
• Euro area flash inflation from Eurostat: 11:00 Central European Time
• UK inflation from the ONS: 7:00 a.m. UK time

Using the calendar to plan

1. On Sunday or Monday, mark the high-impact events for the currencies you trade.
2. Decide in advance whether you will be flat, reduce size or trade the reaction.
3. Remember that spreads widen and stop orders can slip in the seconds around a release.
4. After the event, compare actual with forecast before reading the price move.

For the two releases that move the dollar most, see non-farm payrolls explained and CPI explained.