Central banks wield immense power over currency values, and staying updated on their policies is essential for Forex traders. Follow key institutions like the Federal Reserve, ECB, and Bank of Japan, and pay attention to announcements on interest rates, quantitative easing, and inflation targets. Use economic calendars to track upcoming events and align your trading strategy with market expectations. For instance, if the Fed signals a potential rate hike, USD pairs are likely to react strongly. Anticipating central bank actions allows you to position yourself ahead of significant market moves. Knowledge is power in Forex.