Political and economic news is a powerful source of fluctuations in global financial markets. Even rumors about such events as dropping interest rates of central banks, lawsuits of governments, and large corporations, a sharp rise of inflation and unemployment, or worsening of the international situation invariably cause indignation on exchanges.

The economic factors surrounding Forex are numerous and complex, so it is extremely difficult to form a complete understanding of them. But, armed with useful knowledge, you will be able to navigate in the background of currency quotes fluctuations.

A calendar of economic news should be in the toolbox of every forex trader. There are three main drivers of price action. Geopolitical news, economic news and technical driven trading signals. Regardless of how a trading strategy is build by a trader, all of those aspects needs to be taken into consideration in order to fully understand why a currency pair moved the way it did. Understanding price movements will help traders increase their profits and better their overall trading outcome.

Economic news tends to be one of the most important catalysts for short-term movements in any market, but this is particularly true in the currency market, which responds not only to U.S. economic news, but also to news from around the world.

A financial calendar (also referred to as an economic calendar) is used by traders, shareholders and the media alike, in order to track the important events of the economy. The majority of the time, this is to check for market-moving events, such as monthly jobless claims, factory orders and debt auctions which are all found in the economic calendar.

The US Federal Reserve System has not decided with the time of finishing the quantitative easing program (QE). Such a conclusion can be made after reviewing the published minutes of meetings of the Federal Open Market Committee.

The European Banking Supervision Service announced that 24 large banks have not passed the EU stress tests. In this list: nine Italian banks, three Greek and three Cypriot banks. There were tested 123 banks of the EU member states to identify their ability to withstand another financial crisis.

The Organization for Economic Cooperation and Development (OECD) lowered its forecast for growth in the Russian economy in 2013 up to 2.3% compared with expected 3.8%. Russia's GDP growth forecast for 2014 was lowered from 4.1% to 3.6%, according to the OECD report on the global economic forecast.

The recession in the Spanish economy is deeper than previously thought. Once again checking the data for 2012, The National Statistics Institute of Spain (INE) reported that over the past year the gross domestic product fell by 1.6% instead of 1.4%, as previously reported.