Economic Reports for Futures Traders
The Consumer Price Index is a monthly measure of the
average price level of a fixed basket of common goods and services,
including food, housing and energy, purchased by consumers. The
monthly changes in the CPI represent the rate of inflation which is a
general increase in the prices of goods and services. The Consumer
Price Index is the most widely followed indicator of inflation. It
is the gauge by which we can measure the cost of living and the CPI is
also known as a cost of living index.
The
Producer Price Index (PPI) is considered a leading indicator of
inflation and therefore an indication of how interest rates and bond futures
prices will react. The Producer
Price Index tracks changing domestic prices for wholesale
producers of commodities and gives an indication if there will be higher
costs passed onto the consumer. Higher consumer prices can lead to
an increase in the inflation rate.
This article
talks about GDP in detail and explains its effects, and the effects of
GDP-related data, on the futures markets. Gross Domestic Product (GDP) is one of
the largest headline figures, and it is considered a major indicator of a
country’s economic health. It is one
method of determining whether a region is in recession and therefore one
of the most important economic indicators a futures trader should be looking at.
There are two types of GDP Deflators;
Fixed Weight and Implicit. Both of these are indexes that are
applied to a value estimate of Gross Domestic Product to come up with a
more realistic value of Gross Domestic Product.
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