Economic Indicators is a cluster of collected economic data usually in a macro-economic level, these indicators are used by analysts to interpret future or present investment possibilities. A great amount of statistics that are gathered from government agencies and non-profit organizations and even private companies provide measurements for evaluating the health of the economy of a country. Information like Business cycles, consumer spending and general faring can now be used by investors for then to study and interpret. These indicators are can have a great impact on the market and knowing how to interpret these data is important for all investors because it will help them in recognizing the market trends and patterns.
Investors can choose whatever indicator may deem the most related to their investment, but here are some of the most used indicators.
Gross Domestic Indicator (GDP)
The Gross Domestic Indicator is collected measure of total economic production of a country, it represent all goods and services produced by the economy. This indicator says the most about the health of the economy, which is why it is the most followed indicator. Although, its data is not as timely because it is only released quarterly.
Consumer Price Indicator (CPI)
The CPI Benchmark inflation guide for the U.S. economy, the CPI is an extremely detailed released which analyses the breakouts of the most major consumer groups like food & beverage, apparel and recreation. Analysts will have a better understanding about market trends and will be more confident about what they’ll do even after the Fed’s Open Market after pondering the consumer price index.
Retail Sales Reports
Is very closely watched by both economists and investors, this indicator tracks the value of the Dollar. The release of the retail sales report can cause above-average instability in the market, because its percentage of getting the right prediction of an inflationary pressure can cause investors to rethink the probability of Fed rate cuts or hikes.