Any major deals affecting physical flows could move the currency market, because in order to carry out these agreements, currency would need to be bought and sold. Currently, most of the world's capital belongs to the United States, Europe, and Japan, while most of the world's cheapest labor if found in China, India, and other emerging nations.
Growth in the developing nations is also much stronger than that of the developed nations. Money has been moving from developed to emerging nations for years, so why do we seem to feel that economic pain in the United States more than we have in past years? One major factor that explains this new pain is the speed at which capital can flow.
Today, massive amounts of capital can move quickly around the world through electronic transmission many times in a matter of seconds. In addition, the costs of moving this capital from one country to another dropped dramatically over the past 20 years, as barriers to currency trading were lifted.
In addition to physical flows, you should also watch portfolio flows. These involve the buying and selling of stocks and bonds.
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