Currency prices respond to economic data releases, but not all releases carry equal weight, and knowing which matter most helps avoid being blindsided.
Central bank interest rate decisions are typically the highest-impact scheduled events, since interest rate differentials between countries are a primary driver of currency value over time.
Employment data, particularly from major economies, tends to move markets significantly since it feeds directly into central bank policy expectations.
Inflation data releases matter for similar reasons — unexpected inflation readings can shift market expectations about future interest rate decisions, sometimes causing sharp moves even before the actual rate decision occurs.
Checking an economic calendar before trading, and being aware of scheduled high-impact releases, helps explain otherwise confusing price volatility that has nothing to do with technical chart patterns.