Fundamental Analysis

Fundamental analysis is an approach to evaluating currencies by examining the underlying economic, political, and social factors that influence a nation's currency value. Key indicators include interest rates, GDP growth, inflation, employment data, trade balances, and central bank policies. Forex traders use fundamental analysis to assess whether a currency is overvalued or undervalued and to anticipate market-moving events such as central bank rate decisions or major economic releases. It is often combined with technical analysis to form a comprehensive strategy that accounts for both market structure and macroeconomic drivers.