Written by: Sophie May
International trade holds major clues for investors about the strength of a country’s overall economy and specific industries. Here are the trade reports which have the greatest impact on the financial markets.
Current Account
This report is a measure of the international trade balance across goods, services and unilateral transfers. Trade with foreign countries is a strong indicator of economic trends domestically and abroad. The data has a direct impact on all the financial markets, and in particular the foreign exchange rate of the country’s currency.
Trade Balance
This denotes the difference between the value of the goods and services that a country exports and the value of imports. It includes a variety of products and services from manufactured goods, raw materials and agricultural goods, to travel and transportation. This is valuable information for traders, because it shows the strength of industries and the potential for employment in that sector. For example, the auto sector relies heavily on exports, and so a positive balance of trade reflects greater global demand and more jobs in the industry.
Import & Export Prices
This data refers to the prices of goods that are produced abroad and brought in the U.S. and the prices of goods sold abroad which are produced domestically. Variations in import and export prices provide a valuable indicator of inflation both in America and abroad. This data has a direct influence on the financial markets.
International Trade Reports
International trade is the measure of the value of all imports and exports of goods and services. The U.S. report reveals the monthly changes in import and export levels, as well as the trade balance, the difference between the two, and is a valuable indicator of economic trends. Data has a direct and strong impact on the foreign exchange value of the USD. The report also offers a breakdown of trade with other major countries, making it useful for investors interested in diversifying globally.