1. Japanese Industrial Production
2. German Unemployment Rate
3. U.S. Gross Domestic Product

Japanese Industrial Production (FEB P) (23:50 GMT, 18:50 EST)
Consensus: 0.1% (MoM); 5.4% (YoY)
Previous: 0.4% (MoM); 2.2% (YoY)

Consensus: Industrial growth is expected to continue through February with a preliminary estimate of 0.1% gains in output volume.  As both foreign and domestic demand continue to strengthen, Japan's industrial sector will carry on with its rapid pace of growth.  In February, Japanese exports jumped 14.7%--the largest increase in nearly a decade. Much of this gain in export volume resulted from higher demand for electronic parts and automobiles.  Domestically, industrial growth is being fueled by a much needed surge in consumer spending.  Employment levels in February are expected to increase as is job availability per capita.  A stronger labor market is likely to help sustain the recent trend towards spending.  With both international and domestic markets craving Japanese industrial products, the nation's manufacturing sector is set up for expansion for some time to come.  This may serve as reason for the Bank of Japan to finally begin raising interest rates later this year provided policymakers are convinced that spending and economic growth will be sustainable going forward. 

Previous: Marking the sixth straight month of expansion, industrial production in Japan increased 0.4% to a record volume in January.  This is the longest streak of industrial growth the nation has seen in nine years.  The last time Japan's manufacturing sector grew at this pace for a sustained period was in 1997 when the economy was coming out of a recession.  Furious demand for manufactured goods from both abroad and on the domestic front have moved producers to order more equipment and machinery to increase capacity.  International demand for these products has come largely from the U.S. and China, Japan's two largest export markets where growth has assumed a feverish pace.  As a result of industrial orders from these countries, Japanese exports grew a staggering 13.5% in January.  At home, consumer expenditures have finally started to heat up, requiring producers to step up production even further.  To no surprise, the largest production increases have come in chemicals and electrical machinery.  

German Unemployment Rate s.a. (MAR) (7:55 GMT, 2:55 EST)
Consensus: 11.3%
Previous: 11.3%

Consensus:  The German unemployment rate is expected to go unchanged in February, registering 11.3% for yet another month.  Since 2004, unemployment in Germany has maintained a rate at or very close to this level.  The rate itself, is misleading however, as German businesses have been on a hiring streak for several months.  In March, the number of unemployed is likely to fall by another 5,000, just as it did in February.  With German industry leading economic expansion in the Euro-Zone, export growth is expected to eventually translate into economic expansion on the domestic level as well.  If companies continue to hire employees to meet foreign production demands, spending will start to trigger further inflationary pressure in the Euro-Zone.  To combat this pressure, the European Central Bank will probably increase interest rates yet again, strengthening the trend of higher global
interest rates.     

Previous: In February, Germany's unemployment rate came in at 11.3%. More importantly, however, the number of unemployed in the country fell 5,000 to 4.695 million.  In 10 out of the last 11 months leading up to and including February, the number of unemployed in Germany has fallen. As operating margins increase, German businesses can afford to hire more employees.  Increases in profitability drove business confidence to it highest level in over 14 years in February.  This optimism stirred managers to increase hiring in order to meet strong foreign demand. Germany's economy continues to grow on strong exports, which has ultimately led to higher levels of consumer spending.  As companies require more labor to push capacity up to a level that meets foreign demand, consumers confidence increases, which, in turn, results in more exuberant spending.  A stronger labor market in February drove consumer confidence to its highest point in nearly a year.  

U.S. GDP Annualized (4Q F) (13:30 GMT, 8:30 EST)
Consensus: 1.7%
Previous: 4.1%

Consensus: In the fourth quarter of 2005, U.S. Gross Domestic Product is expected to have taken on a slower pace of growth of 1.7%.  The feverish rate of consumer spending that characterized the previous quarter was not present from October to December.  Whereas purchasing of automobiles was through the roof in the third quarter, end of year sales were meager as manufacturers discontinued their offering of generous summer discounts.  Likewise, the housing market cooled off significantly in the third quarter.  Perpetually rising interest rates have finally begun to deter investors from the real estate market as investing becomes increasingly expensive.  Although at a much slower pace than the previous three months, the economy was still able to grow on strong capital expenditures by businesses.  With potential for further growth in consumer demand, businesses continued to add equipment at the end of the year.  The fourth quarter's slowdown in GDP growth is most probably temporary and a faster rate of expansion is likely to resume in the first quarter of 2006.  A recent acceleration in consumer spending and a surge in production to replenish inventories will probably feed growth early in 2006.  As employment levels increase, inflationary pressure will build and the Federal reserve will be able to persist in its interest rate hikes. 

Previous: GDP of the U.S. economy grew at a swift pace of 4.1% in the third quarter of 2005, up from 3.3% in the previous quarter.  This was the 10th straight quarter of GDP growth above 3.0%, making the U.S. economy's current surge the longest since just before the market crash of 1986.  Car sales, increased manufacturing productivity, and fervent home-building activity helped fuel growth over the quarter.  In the months from July to September, auto sales averaged 18 million units a month in comparison to the previous quarter's average of 17.2 million units a month and 2004's average of 16.9 million.  Heavy manufacturer discounts were most likely the largest factor contributing to exuberant automobile purchases.  Also serving as a catalyst for GDP growth was improved productivity resulting from a 10.6% jump in equipment and software investment by U.S. businesses.  Housing activity was also sizzling in the third quarter as new housing starts came in at 2.1 million.  Residential construction in general increased at a rate of 7.3%.  Whether on automobiles, business fixed investments, or housing, spending continued to increase unabated in the third quarter, which only strengthened the Fed's resolve to stick to their strict policy of interest rate tightening. 

Richard Lee is a Currency Strategist at FXCM.