Introduction
If you have no idea what CPI, PMI, or ECI mean, then you are like most beginning investors/Traders. Let me explain these and a few others terms to enhance your knowledge of indicators that affect your investments.
Economic Indicators are used by the Federal Reserve to monitor inflation. When they reflect inflationary pressure, the Fed will increase interest rates. Conversely, when they show signs of deflation, a decrease of interest rates becomes imminent. Interest rates are important for the economy because they influence the willingness of individuals and businesses to borrow money and make investments. An increase of interest rates will cause a downturn in the economy, while a decrease will fuel an expansion.
The purpose of this tutorial is to explain in simple terms, the twenty economic indicators followed by most investors and analysts. The next time you hear these terms in the media and or financial press, you can use the information in this tutorial to evaluate their potential effect on the economy and ultimately on your trades/portfolio.
Economic Indicators:
1. Beige Book
2.
3. Consumer Confidence Index
4. Consumer Price Index (CPI)
5. Durable Goods Orders
6. Employment Cost Index (ECI)
7. Employment Situation
8. Existing Home Sales
9. Gross Domestic Product (GDP)
10. Housing Starts and Building Permits
11. Industrial Production and Capacity Utilization
12. Initial Claims
13. ISM Manufacturing Index
14. ISM Services Index
15. New Home Sales
16. Personal Income and Consumption
17.
18. Producer Price Index (PPI)
19. Retail Sales
20. International Trade
