CALENDER NEWS 12 JANUARY 2007

Fri. 01/12 7:50am JPY M2+CD Money Supply y/y 0.8% 0.8% 0.7%
Definition Measures the annual change in currency outstanding. Higher levels of currency can have a devaluing effect on the currency. M2+CD is calculated as follows:
M1 = currency in circulation + overnight deposits
M2+CD = M1 + Quasi-Money (Time Deposits etc.) + CDs

1:00pm JPY Eco Watchers Survey 49.8 48.9
Definition Measures the mood of businesses that directly service consumers, such as barbers, taxi drivers, and waiters. A reading above 50 signals an improvement in sentiment.

3:45pm EUR French CPI m/m 0.1% 0.1%
Definition The Consumer Price Index (CPI) measures the rate of inflation (i.e., the rate of price changes) experienced by consumers when purchasing goods and services. A rising trend has a positive effect on the nation's currency. The primary objective of the central bank is to achieve price stability; when inflation rises above an annualized rate of approximately 2%, they will respond by raising interest rates to bring prices down. Higher interest rates attract foreign investment, thus increasing demand for the nation's currency. CPI is one of the most closely watched indicators and will usually have a high impact upon release.

7:00pm EUR Composite Leading Indicators m/m 109.4
Definition Measures overall economic health by combining ten leading indicators including average weekly hours, new orders, consumer expectations, housing permits, stock prices, and interest rate spreads. The index is published monthly by The Organization for Economic Co-operation and Development (OECD), a leading private research group, but traders tend to pay little attention because the components that make up the index are reported at an earlier date.

9:30pm USD Retail Sales m/m 0.6% 1.0%
Definition Measures the value of sales at the retail level. A rising trend has a positive effect on the nation's currency because Retail Sales make up a large portion of consumer spending, which is a major driver of the economy and has a sizable impact on GDP. Traders pay close attention to Retail Sales because it is usually the first significant indicator of the month that relates to consumer behavior and is susceptible to surprises.

9:30pm USD Core Retail Sales m/m 0.5% 1.1%
Definition Derivative of Retail Sales that excludes the Automobile Sales component. Automobile Sales make up roughly 25% of Retail Sales, but they can be very volatile from month to month and can distort the picture. Retail Sales with the exclusion of this volatile component is thought to be a better indicator of the underlying trend in consumer spending.

9:30pm USD Import Price Index m/m 0.5% 0.2%
Definition Measures the monthly rate of inflation for imported goods.

11:00pm USD Business Inventories m/m 0.4% 0.4%
Definition Measures the value of goods held by manufacturers, wholesalers, and retailers. A falling trend has a positive effect on the nation's currency because retailers order more goods when they have depleted inventories. This creates more business for the wholesales, who in turn increase their orders to manufacturers.



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