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Per traders alle prime armi
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I profitti sono tuoi, le perdite annullate
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Keep up to date with the most important events and economic indicators that drive the Forex Market.
Use the Date Range button below in order to go back to previous weeks.
Events may also be brought into focus by filtering their origin and level of importance.
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| S | M | T | W | T | F | S
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Today: 20 Nov 2009
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Results for the week of:15/11/2009 - 21/11/2009
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| 15/11/2009 | 21:45 | | | Producer Price Index (PPI) mm | -1.1% | 0.3% | -0.7% | Q3 |  |
Country: NewZealand
Source: Bureau of Labor statistics, U.S. Department of Labor.
Raw Data Available At: http://stats.bls.gov/news.release/ppi.toc.htm
Release Time: Around the 11th of each month at 8:30 ET for the prior month.
The Producer Price Index measures prices of goods at the wholesale level. There are three broad subcategories within PPI: crude, intermediate, and finished. The market tracks the finished goods index most closely, as it represents prices for goods that are ready for sale to the end user. Goods prices at the crude and intermediate stages of production often provide an indication of coming (dis)inflationary pressures, but the closer you get to crude goods, the more that these prices track commodity prices which are already available in traded indexes such as the CRB (Commodity Research Bureau).
At all stages of production, the market places more emphasis on the index excluding food and energy, referred to as the core rate. Food and energy prices tend to be quite volatile and obscure trends in the underlying inflation rate. Though the market reaction is determined by the month/month changes, year/year changes are also noted by analysts. The index is not revised on a monthly basis, but annual revisions to seasonal adjustment factors can produce small adjustments to past releases.
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| 15/11/2009 | 23:50 | | | Gross Domestic Product (GDP) yy | 4.8% | 2.9% | 2.3% | Q3 | |
Country: Japan
Source: Bureau of Economic Analysis, U.S. Department of Commerce.
Raw Data Available At: http://www.bea.doc.gov/bea/dn1.htm
Release Time: Third or fourth week of the month at 8:30 ET for the prior quarter, with subsequent revisions released in the second and third months of the quarter.
Gross Domestic Product (GDP) is the broadest measure of economic activity. Annualized quarterly percent changes in GDP reflect the growth rate of total economic output. The figures can be quite volatile from quarter to quarter. Inventory and net export swings in particular can produce significant volatility in GDP. The final sales figure, which excludes inventories, can sometimes be helpful in identifying underlying growth trends as inventories represent unsold goods, and a large inventory increase will boost GDP but might be indicative of weakness rather than strength. The broad components of GDP are: consumption, investment, net exports, government purchases, and inventories. Consumption is by far the largest component, totalling roughly 2/3rds of GDP.
In addition to the GDP figures, there are GDP deflators, which measure the change in prices in total GDP and for each component. Though the consumer price index is a more closely watched inflation indicator, the GDP deflator is another key inflation measure. Unlike CPI, it has the advantage of not being a fixed basket of goods and services, so that changes in consumption patterns or the introduction of new goods and services will be reflected in the deflator.
With both GDP and the deflator, the market tends to focus on the quarter/quarter change. Year/year changes are also cited frequently, though they do not provide the most timely indications of economic activity or inflation. The bond market often reacts to GDP, though the price moves are typically small, as much of the GDP data is easily predicted using monthly economic releases such as personal consumption, durable goods shipments, construction spending, international trade, and inventories.
Quarterly GDP reports are broken down into three announcements: advance, preliminary, and final. After the final revision, GDP is not revised again until the annual benchmark revisions each July. These revisions can be quite large and usually affect the past five years of data.
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| 15/11/2009 | 23:50 | | | Gross Domestic Product (GDP) qq | 1.2% | 0.7% | 0.6% | Q3 | |
Country: Japan
Source: Bureau of Economic Analysis, U.S. Department of Commerce.
Raw Data Available At: http://www.bea.doc.gov/bea/dn1.htm
Release Time: Third or fourth week of the month at 8:30 ET for the prior quarter, with subsequent revisions released in the second and third months of the quarter.
Gross Domestic Product (GDP) is the broadest measure of economic activity. Annualized quarterly percent changes in GDP reflect the growth rate of total economic output. The figures can be quite volatile from quarter to quarter. Inventory and net export swings in particular can produce significant volatility in GDP. The final sales figure, which excludes inventories, can sometimes be helpful in identifying underlying growth trends as inventories represent unsold goods, and a large inventory increase will boost GDP but might be indicative of weakness rather than strength. The broad components of GDP are: consumption, investment, net exports, government purchases, and inventories. Consumption is by far the largest component, totalling roughly 2/3rds of GDP.
In addition to the GDP figures, there are GDP deflators, which measure the change in prices in total GDP and for each component. Though the consumer price index is a more closely watched inflation indicator, the GDP deflator is another key inflation measure. Unlike CPI, it has the advantage of not being a fixed basket of goods and services, so that changes in consumption patterns or the introduction of new goods and services will be reflected in the deflator.
With both GDP and the deflator, the market tends to focus on the quarter/quarter change. Year/year changes are also cited frequently, though they do not provide the most timely indications of economic activity or inflation. The bond market often reacts to GDP, though the price moves are typically small, as much of the GDP data is easily predicted using monthly economic releases such as personal consumption, durable goods shipments, construction spending, international trade, and inventories.
Quarterly GDP reports are broken down into three announcements: advance, preliminary, and final. After the final revision, GDP is not revised again until the annual benchmark revisions each July. These revisions can be quite large and usually affect the past five years of data.
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| 16/11/2009 | 10:00 | | | Core HICP mm | 0.2% | 0.3% | 0.2% | Oct | |
Country: EMU
Source: EU Eurostat.
Raw Data Available At: http://europa.eu.int/comm/eurostat/
HICP is the inflation indicator used by the European Central Bank: The method for calculating the CPI varies in different countries and can cause problems for international comparisons. To address this problem, a harmonized index of consumer prices (HICP) have been developed within EU, based on coordinated methodology. HICP is a fundamental indicator for the European Central Bank (ECB) in evaluating EMU's monetary policy goals. HICP is also used to follow up the convergence criteria for price stability with regards to membership in EMU.
HICP can be greatly influenced in any given month by a movement in volatile food and energy prices. Therefore, it is important to look at HICP excluding food and energy, commonly called the "core rate" of inflation. Within the core rate, some of the more volatile and closely watched components are apparel, tobacco, airfares, and new cars. In addition to tracking the month/month changes in core HICP, the year/year change in core HICP is seen by most economists as the best measure of the underlying inflation rate.
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| 16/11/2009 | 10:00 | | | Core HICP yy | 1% | 1.1% | 1.1% | Oct | |
Country: EMU
Source: EU Eurostat.
Raw Data Available At: http://europa.eu.int/comm/eurostat/
HICP is the inflation indicator used by the European Central Bank: The method for calculating the CPI varies in different countries and can cause problems for international comparisons. To address this problem, a harmonized index of consumer prices (HICP) have been developed within EU, based on coordinated methodology. HICP is a fundamental indicator for the European Central Bank (ECB) in evaluating EMU's monetary policy goals. HICP is also used to follow up the convergence criteria for price stability with regards to membership in EMU.
HICP can be greatly influenced in any given month by a movement in volatile food and energy prices. Therefore, it is important to look at HICP excluding food and energy, commonly called the "core rate" of inflation. Within the core rate, some of the more volatile and closely watched components are apparel, tobacco, airfares, and new cars. In addition to tracking the month/month changes in core HICP, the year/year change in core HICP is seen by most economists as the best measure of the underlying inflation rate.
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| 16/11/2009 | 10:00 | | | HICP mm | 0.2% | 0.3% | 0.0% | Oct | |
Country: EMU
Source: EU Eurostat.
Raw Data Available At: ttp://europa.eu.int/comm/eurostat/
HICP is the inflation indicator used by the European Central Bank: The method for calculating the CPI varies in different countries and can cause problems for international comparisons. To address this problem, a harmonized index of consumer prices (HICP) have been developed within EU, based on coordinated methodology. HICP is a fundamental indicator for the European Central Bank (ECB) in evaluating EMU's monetary policy goals. HICP is also used to follow up the convergence criteria for price stability with regards to membership in EMU.
1996 is the base year and the index is calculated starting in 1995.
Certain entries that are currently treated particularly differently in the calculation of national CPIs have been excluded. One particular difference compared with the CPI is that interest costs for owner-occupied homes are not included in the HICP. In addition, certain costs of owner-occupied homes (repairs, real-estate taxes, write-offs, insurance and ground rents), fees for tenant-owned flats, as well as lotteries, pools and tote betting are excluded. Some entries are included in the HICP but not in the CPI. These include childcare, elder care, hospital care and certain financial services (services where the fee is proportional to the size of the transaction).
HICP is based on a completely harmonized product classification, COICOP (Classification Of Individual Consumption by Purpose). Harmonized rules for coverage, consideration of new products, updating the product sample, adjustments for changes in quality, and index formulas for the calculations are also used in calculating the HICP.
The methods for calculating the index numbers and price changes for the HICP differ to a certain extent from the CPI. Similar to the CPI, the HICP is a chained index with yearly links but a long-term index is not calculated. Instead, yearly links in the HICP are calculated in the same way as the CPI's short-term index.
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| 16/11/2009 | 10:00 | | | HICP yy | -0.1% | -0.1% | -0.3% | Oct | |
Country: EMU
Source: EU Eurostat.
Raw Data Available At: ttp://europa.eu.int/comm/eurostat/
HICP is the inflation indicator used by the European Central Bank: The method for calculating the CPI varies in different countries and can cause problems for international comparisons. To address this problem, a harmonized index of consumer prices (HICP) have been developed within EU, based on coordinated methodology. HICP is a fundamental indicator for the European Central Bank (ECB) in evaluating EMU's monetary policy goals. HICP is also used to follow up the convergence criteria for price stability with regards to membership in EMU.
1996 is the base year and the index is calculated starting in 1995.
Certain entries that are currently treated particularly differently in the calculation of national CPIs have been excluded. One particular difference compared with the CPI is that interest costs for owner-occupied homes are not included in the HICP. In addition, certain costs of owner-occupied homes (repairs, real-estate taxes, write-offs, insurance and ground rents), fees for tenant-owned flats, as well as lotteries, pools and tote betting are excluded. Some entries are included in the HICP but not in the CPI. These include childcare, elder care, hospital care and certain financial services (services where the fee is proportional to the size of the transaction).
HICP is based on a completely harmonized product classification, COICOP (Classification Of Individual Consumption by Purpose). Harmonized rules for coverage, consideration of new products, updating the product sample, adjustments for changes in quality, and index formulas for the calculations are also used in calculating the HICP.
The methods for calculating the index numbers and price changes for the HICP differ to a certain extent from the CPI. Similar to the CPI, the HICP is a chained index with yearly links but a long-term index is not calculated. Instead, yearly links in the HICP are calculated in the same way as the CPI's short-term index.
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| 16/11/2009 | 13:30 | | | New-York Fed Survey | 23.51 | 31.0 | 34.57 | Nov | |
Country: US
Source: Chicago Purchasing Managers Association.
Raw Data Available At: http://www.phil.frb.org/
Release Time: Last business day of the month at 10 ET for the current month.
In Brief
There are many regional manufacturing surveys, and they tend to be ranked in order of timeliness and the importance of the region. The Philadelphia Fed's survey is first each month, actually coming out during the third week of the month for which it is reporting. Several smaller surveys are then released before the Chicago purchasing managers' report on the last day of each month. A few, such as the Atlanta and Richmond Fed surveys, are released after the NAPM and are of little value. The purchasing managers' reports are measured like the national NAPM - 50% marks the breakeven line between an expanding and contracting manufacturing sector. For the Philadelphia and Atlanta Fed indexes, 0 is the breakeven mark.
These surveys can be of some help in forecasting the national NAPM - particularly the Philadelphia and Chicago surveys which are more closely watched due to their timeliness and the fact that these regions represent a reasonable cross section of national manufacturing activities.
In Depth
The market has been bombarded with a bevy of surveys purporting to measure manufacturing activity in every nook and cranny of the country. First it was Philadelphia, then Chicago, and Detroit, Milwaukee, New York, Cincinnati, Richmond, Atlanta, Boston, and there might as well have been a Nome survey. This hodge-podge of releases is begging for someone - namely us - to come along and cut this group down to a more manageable size.
Nuts and Bolts
Let's start with the issue of what these manufacturing surveys are trying to measure and how they go about doing it. The leader of this pack of regional surveys is the ISM index which comes from the Institute for Supply Management (formerly the National Association of Purchasing Managers). It has been around since 1931 (1948 on an uninterrupted basis), it is national, and it is one of the most timely measures of manufacturing activity available. In other words, it sets the standards by which its progeny are measured.
The ISM index is actually a composite of five sub-indexes - new orders, production, supplier deliveries, inventories, and employment. In surveying over 300 companies each month, the ISM asks for positive, negative, or unchanged readings on each of these indicators. The positive responses are added to one half of the unchanged responses to produce the diffusion index. For example, if 50% of respondents reported stronger orders, 40% reported weaker, and 10% unchanged, the diffusion index for orders would be 55%, the 50% positive plus half of the 10% unchanged. To calculate the total index, the ISM uses weights for the five indicators, which are as follows: 30% new orders, 25% production, 20% employment, 15% supplier deliveries, and 10% inventories.
The Selection Criteria
Since this methodology has made the ISM index one of the better leading indicators of economic activity over the years, we will measure the usefulness of the regional indexes based on their ability to help in forecasting the national index. In our effort to arrive at the most important regional indices, these criteria make eliminating most of the candidates easy for one simple reason - they are released after the national index. While regional economic developments are of interest to those who live in the region, they are not particularly important to the markets. If a region cannot help in forecasting national trends, then its data are not particularly useful. So say adios to Atlanta, Richmond, Kansas City, and who knows how many others which have cropped up in recent years.
And the Winner Is...
Let's focus on the regional surveys which precede the release of the national index on the first business day of each month (with data for the prior month). The contestants are Philadelphia, Chicago, Milwaukee, Detroit, New York, and the most recent addition to the bunch - the APICS survey. We looked at the correlation of all of these indexes to the national NAPM and found substantial differences in their forecasting ability. The winners are...drum roll please...Chicago and Philadelphia, in that order.
The Chicago PMI (officially known as the Business Barometer) is a monthly composite index based on opinion surveys of more than 200 Chicago purchasing managers regarding the manufacturing industry. The survey responses are limited to three options: slower, faster and same. As such, the index will not capture if a component is growing but at a much slower rate or vice versa. The index is a composite of seven similarly constructed indexes including: new orders, production, supplier delivery times, backlogs, inventories, prices paid, and employment. New orders and orders backlog indices indicate future production activity. It signals factory-sector expansion when it is above 50 and contraction when below it. The index is seasonally adjusted for the effects of variations within the year, differences due to holidays and institutional changes. Because it is an opinion survey, it is often influenced by respondents’ perception of current events, as opposed to actual hard data. Also, it does not capture technological
and production changes, which make it possible for production to expand, while employment contracts. Because the Chicago PMI is released the day before the ISM, it is watched in order to predict the more important ISM report (the Chicago PMI has an impressive 91% correlation with the ISM national NAPM), which is in itself a good leading indicator of overall economic activity. It frequently moves markets.
The Philadelphia Fed index, which is released on the third Thursday of the month (with data for the same month), was a distant second at 76%. Philly Fed's performance improved slightly to 78% when Briefing measured its results using the NAPM methodology. The Philly index as released is not a composite of its subindexes, as the NAPM is. Instead, the Philly Fed survey asks many questions, but the total index is based on the general question "are business conditions better or worse than last month." It is often the case that a weighted measure of the individual questions on specifics such as new orders and production moves in a different direction than the index based on the general question.
The rest of the regional indexes fared poorly, ranging from correlations as poor as 55% (APICS) to 73% (Milwaukee). Chicago was the clear winner, but the Philly Fed index definitely deserves recognition, particularly since it is released so much earlier than the rest. In the future, then, we would recommend setting aside most of the regional manufacturing surveys and focussing on just Philly and Chicago, which offer the best hope of predicting the national index. And when you look at the Philly index, improve your chances by looking at the Philly numbers calculated on an NAPM basis, which Briefing will be happy to provide.
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| 16/11/2009 | 13:30 | | | Core Retail Sales mm | 0.2% | 0.4% | 0.5% | Oct | |
Country: US
Source: The Census Bureau of the Department of Commerce.
Raw Data Available At: http://www.census.gov/svsd/www/advtable.html
Release Time: 8:30 ET around the 13th of the month (data for one month prior).
The retail sales report is a measure of the total receipts of retail stores. The changes in retail sales are widely followed as the most timely indicator of broad consumer spending patterns. Retail sales are often viewed ex-autos, as auto sales can move sharply from month-to-month. It is also important to keep an eye on the gas and food components, where changes in sales are often a result of price changes rather than shifting consumer demand. |
| 16/11/2009 | 13:30 | | | Retail Sales mm | 1.4% | 0.8% | -1.5% | Oct | |
Country: US
Source: The Census Bureau of the Department of Commerce.
Raw Data Available At: http://www.census.gov/svsd/www/advtable.html
Release Time: 8:30 ET around the 13th of the month (data for one month prior).
The retail sales report is a measure of the total receipts of retail stores. The changes in retail sales are widely followed as the most timely indicator of broad consumer spending patterns. Retail sales are often viewed ex-autos, as auto sales can move sharply from month-to-month. It is also important to keep an eye on the gas and food components, where changes in sales are often a result of price changes rather than shifting consumer demand.
Retail sales can be quite volatile and the advance reports are subject to rather large revisions. Retail sales do not include spending on services, which makes up over half of total consumption. Total personal consumption is not available until the personal income and consumption reports are released, typically two weeks after retail sales.
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| 16/11/2009 | 15:00 | | | Business Inventories | -0.4% | -0.6% | -1.6% | Sep | |
Country: US
Source: The Census Bureau of the Department of Commerce.
Raw Data Available At: http://www.census.gov/mtis/www/current.html
Release Time: 08:30 ET around the 15th of the month (data for two months prior).
The business inventories report includes sales and inventory statistics from all three stages of the manufacturing process (manufacturing, wholesale, and retail). But by the time it is released all three of its sales components and two of its inventory components have already been reported. Because retail inventory is the only new piece of information it contains, the market usually ignores the business inventories report.
However, sometimes retail inventories swing enough to change the aggregate inventory profile. This may affect the GDP outlook. When it does, the report can elicit a small market reaction.
The aggregate sales figures are dated and they say little about personal consumption. They are actually a good coincident indicator, but the market is far more interested in forward-looking statistics.
The inventory-to-sales (I/S) ratio measures the number of months it would take to deplete existing inventory at current sales rates. A relatively low (high) I/S ratio may mean that manufacturers will have to build up (draw down) inventory levels. Depending on the strength of final demand and the degree to which recent inventory changes have been intended or unintended, this can have an effect on the industrial production outlook. Note that this information is much more useful to market economists than it is to other market participants.
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| 16/11/2009 | 17:15 | | | Fed Chairman Bernanke Speaks | | | | | |
| Country: US |
| 17/11/2009 | 08:15 | | | Retail Sales mm | -1.6% | | -1.0% | Sep | |
Country: Switzerland
Source: The Census Bureau of the Department of Commerce.
Raw Data Available At: http://www.census.gov/svsd/www/advtable.html
Release Time: 8:30 ET around the 13th of the month (data for one month prior).
The retail sales report is a measure of the total receipts of retail stores. The changes in retail sales are widely followed as the most timely indicator of broad consumer spending patterns. Retail sales are often viewed ex-autos, as auto sales can move sharply from month-to-month. It is also important to keep an eye on the gas and food components, where changes in sales are often a result of price changes rather than shifting consumer demand.
Retail sales can be quite volatile and the advance reports are subject to rather large revisions. Retail sales do not include spending on services, which makes up over half of total consumption. Total personal consumption is not available until the personal income and consumption reports are released, typically two weeks after retail sales.
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| 17/11/2009 | 09:30 | | | Consumer Price Index (CPI) mm | 0.2% | 0.1% | 0.0% | Oct | |
Country: UK
Source: Bureau of Labor statistics, U.S. Department of Labor.
Raw Data Available At: http://stats.bls.gov/news.release/cpi.toc.htm
Release Time: 8:30 ET, about the 13th of each month for the prior month.
The Consumer Price Index is a measure of the price level of a fixed market basket of goods and services purchased by consumers. CPI is the most widely cited inflation indicator, and it is used to calculate cost of living adjustments for government programs and it is the basis of COLAs for many private labor agreements as well. It has been criticized for overstating inflation, because it does not adjust for substitution effects and because the fixed basket does not reflect price changes in new technology goods which are often declining in price. Despite these criticisms, it remains the benchmark inflation index.
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| 17/11/2009 | 09:30 | | | Consumer Price Index (CPI) yy | 1.5% | 1.5% | 1.1% | Oct | |
Country: UK
Source: Bureau of Labor statistics, U.S. Department of Labor.
Raw Data Available At: http://stats.bls.gov/news.release/cpi.toc.htm
Release Time: 8:30 ET, about the 13th of each month for the prior month.
The Consumer Price Index is a measure of the price level of a fixed market basket of goods and services purchased by consumers. CPI is the most widely cited inflation indicator, and it is used to calculate cost of living adjustments for government programs and it is the basis of COLAs for many private labor agreements as well. It has been criticized for overstating inflation, because it does not adjust for substitution effects and because the fixed basket does not reflect price changes in new technology goods which are often declining in price. Despite these criticisms, it remains the benchmark inflation index.
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| 17/11/2009 | 09:30 | | | Retail Price Index (RPI) mm | 0.3% | 0.1% | 0.4% | Oct | |
Country: UK
The RPI Contains figures for the RPIX (RPI which excludes mortgage interest payments), until 10 December 2003 published as the UK main measure of inflation. Since then, the HICP in considered as the main measure of inflation for macroeconomic purposes. The harmonised indices of consumer prices (HICPs) are calculated in each member state of the European Union for the purposes of European comparisons, as required by the Maastricht Treaty.
The RPI is often described in terms of a shopping basket containing some 650 goods and services, chosen as indicators of price movements for a range of similar items. Taking bread as an example, several different types of bread are priced (e.g. large white loaves (sliced and unsliced), small brown loaf, large wholemeal loaf, bread rolls, pitta bread and french stick/baguette). These are considered as representative of the majority of bread consumption by most households.
Each price collector collects the price of a representative item (e.g. brand) for that price indicator in January and exactly the same item/ brand must be priced every month for a period of thirteen months. Each month price indices are constructed comparing the latest price with the price in the base month (January).
Finally price indices for price indicators are aggregated to items and then to sections which is the published level and rescaled to a reference point of January 1987=100. This allows price changes to be compared to a year earlier (i.e. the annual inflation rate) and to previous years.
How is it published?
Every month data is published on either the second or third Tuesday in a month (depending on the month) in a Consumer Price Indices First Release along with Additional Briefing Notes, which give the stories behind the figures. Data is also published in the electronic publication Focus on Consumer Prices available on the National Statistics website.
How often are the components reviewed?
The Office for National Statistics reviews the components of the Retail Price Index once every year, to keep it as up to date as possible, reflecting changes in consumers' preferences and the establishment of new products. Each year the changes are announced in a News Release and published in an article.
What are the origins of the Retail Prices?
Although there were occasional official comparisons of prices for food in the nineteenth and early twentieth century, the Government first began a systematic, continuous check on the increase of the cost of living in 1914, but the coverage was very limited. After the Second World War a cost of living Advisory Committee was set up and an experimental price index known as the Interim Index of Retail Prices ran from 1947 to 1956. In January 1956, the first official Retail Prices Index began with various methodological changes implemented since then following reviews by RPI Advisory Committees. The latest Advisory Committees met in the early 1990s and made recommendations about the treatment of housing costs, holidays and car prices.
RPIX, which excludes mortgage interest payments;
RPIY, which excludes mortgage interest rates and indirect taxes (VAT, council tax, duties vehicle excise duty, insurance tax and air passenger duty);
Quarterly Pensioner Indices, which use the same price data as RPI, weighted for the typical spending of one and two-pensioner households and excluding items such as school dinners, work place canteen meals and housing; and the
Tax and Price Index, which measures how much the average person's gross income needs to change to purchase the RPI basket after allowing for the average amount of income tax and national insurance paid on earnings.
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| 17/11/2009 | 09:30 | | | Retail Price Index (RPI) yy | -0.8% | -1.0% | -1.4% | Oct | |
Country: UK
The RPI Contains figures for the RPIX (RPI which excludes mortgage interest payments), until 10 December 2003 published as the UK main measure of inflation. Since then, the HICP in considered as the main measure of inflation for macroeconomic purposes. The harmonised indices of consumer prices (HICPs) are calculated in each member state of the European Union for the purposes of European comparisons, as required by the Maastricht Treaty.
The RPI is often described in terms of a shopping basket containing some 650 goods and services, chosen as indicators of price movements for a range of similar items. Taking bread as an example, several different types of bread are priced (e.g. large white loaves (sliced and unsliced), small brown loaf, large wholemeal loaf, bread rolls, pitta bread and french stick/baguette). These are considered as representative of the majority of bread consumption by most households.
Each price collector collects the price of a representative item (e.g. brand) for that price indicator in January and exactly the same item/ brand must be priced every month for a period of thirteen months. Each month price indices are constructed comparing the latest price with the price in the base month (January).
Finally price indices for price indicators are aggregated to items and then to sections which is the published level and rescaled to a reference point of January 1987=100. This allows price changes to be compared to a year earlier (i.e. the annual inflation rate) and to previous years.
How is it published?
Every month data is published on either the second or third Tuesday in a month (depending on the month) in a Consumer Price Indices First Release along with Additional Briefing Notes, which give the stories behind the figures. Data is also published in the electronic publication Focus on Consumer Prices available on the National Statistics website.
How often are the components reviewed?
The Office for National Statistics reviews the components of the Retail Price Index once every year, to keep it as up to date as possible, reflecting changes in consumers' preferences and the establishment of new products. Each year the changes are announced in a News Release and published in an article.
What are the origins of the Retail Prices?
Although there were occasional official comparisons of prices for food in the nineteenth and early twentieth century, the Government first began a systematic, continuous check on the increase of the cost of living in 1914, but the coverage was very limited. After the Second World War a cost of living Advisory Committee was set up and an experimental price index known as the Interim Index of Retail Prices ran from 1947 to 1956. In January 1956, the first official Retail Prices Index began with various methodological changes implemented since then following reviews by RPI Advisory Committees. The latest Advisory Committees met in the early 1990s and made recommendations about the treatment of housing costs, holidays and car prices.
RPIX, which excludes mortgage interest payments;
RPIY, which excludes mortgage interest rates and indirect taxes (VAT, council tax, duties vehicle excise duty, insurance tax and air passenger duty);
Quarterly Pensioner Indices, which use the same price data as RPI, weighted for the typical spending of one and two-pensioner households and excluding items such as school dinners, work place canteen meals and housing; and the
Tax and Price Index, which measures how much the average person's gross income needs to change to purchase the RPI basket after allowing for the average amount of income tax and national insurance paid on earnings.
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| 17/11/2009 | 09:30 | | | RPI ex. Mortgage (RPIX) mm | 0.3% | 0.2% | 0.4% | Oct | |
Country: UK
The RPI Contains figures for the RPIX (RPI which excludes mortgage interest payments), until 10 December 2003 published as the UK main measure of inflation. Since then, the HICP in considered as the main measure of inflation for macroeconomic purposes. The harmonised indices of consumer prices (HICPs) are calculated in each member state of the European Union for the purposes of European comparisons, as required by the Maastricht Treaty.
The RPI is often described in terms of a shopping basket containing some 650 goods and services, chosen as indicators of price movements for a range of similar items. Taking bread as an example, several different types of bread are priced (e.g. large white loaves (sliced and unsliced), small brown loaf, large wholemeal loaf, bread rolls, pitta bread and french stick/baguette). These are considered as representative of the majority of bread consumption by most households.
Each price collector collects the price of a representative item (e.g. brand) for that price indicator in January and exactly the same item/ brand must be priced every month for a period of thirteen months. Each month price indices are constructed comparing the latest price with the price in the base month (January).
Finally price indices for price indicators are aggregated to items and then to sections which is the published level and rescaled to a reference point of January 1987=100. This allows price changes to be compared to a year earlier (i.e. the annual inflation rate) and to previous years.
How is it published?
Every month data is published on either the second or third Tuesday in a month (depending on the month) in a Consumer Price Indices First Release along with Additional Briefing Notes, which give the stories behind the figures. Data is also published in the electronic publication Focus on Consumer Prices available on the National Statistics website.
How often are the components reviewed?
The Office for National Statistics reviews the components of the Retail Price Index once every year, to keep it as up to date as possible, reflecting changes in consumers' preferences and the establishment of new products. Each year the changes are announced in a News Release and published in an article.
What are the origins of the Retail Prices?
Although there were occasional official comparisons of prices for food in the nineteenth and early twentieth century, the Government first began a systematic, continuous check on the increase of the cost of living in 1914, but the coverage was very limited. After the Second World War a cost of living Advisory Committee was set up and an experimental price index known as the Interim Index of Retail Prices ran from 1947 to 1956. In January 1956, the first official Retail Prices Index began with various methodological changes implemented since then following reviews by RPI Advisory Committees. The latest Advisory Committees met in the early 1990s and made recommendations about the treatment of housing costs, holidays and car prices.
RPIX, which excludes mortgage interest payments;
RPIY, which excludes mortgage interest rates and indirect taxes (VAT, council tax, duties vehicle excise duty, insurance tax and air passenger duty);
Quarterly Pensioner Indices, which use the same price data as RPI, weighted for the typical spending of one and two-pensioner households and excluding items such as school dinners, work place canteen meals and housing; and the
Tax and Price Index, which measures how much the average person's gross income needs to change to purchase the RPI basket after allowing for the average amount of income tax and national insurance paid on earnings.
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| 17/11/2009 | 09:30 | | | RPI ex. Mortgage (RPIX) yy | 1.8% | 1.8% | 1.3% | Oct | |
Country: UK
The RPI Contains figures for the RPIY (RPI which excludes mortgage interest payments), until 10 December 2003 published as the UK main measure of inflation. Since then, the HICP in considered as the main measure of inflation for macroeconomic purposes. The harmonised indices of consumer prices (HICPs) are calculated in each member state of the European Union for the purposes of European comparisons, as required by the Maastricht Treaty.
The RPI is often described in terms of a shopping basket containing some 650 goods and services, chosen as indicators of price movements for a range of similar items. Taking bread as an example, several different types of bread are priced (e.g. large white loaves (sliced and unsliced), small brown loaf, large wholemeal loaf, bread rolls, pitta bread and french stick/baguette). These are considered as representative of the majority of bread consumption by most households.
Each price collector collects the price of a representative item (e.g. brand) for that price indicator in January and exactly the same item/ brand must be priced every month for a period of thirteen months. Each month price indices are constructed comparing the latest price with the price in the base month (January).
Finally price indices for price indicators are aggregated to items and then to sections which is the published level and rescaled to a reference point of January 1987=100. This allows price changes to be compared to a year earlier (i.e. the annual inflation rate) and to previous years.
How is it published?
Every month data is published on either the second or third Tuesday in a month (depending on the month) in a Consumer Price Indices First Release along with Additional Briefing Notes, which give the stories behind the figures. Data is also published in the electronic publication Focus on Consumer Prices available on the National Statistics website.
How often are the components reviewed?
The Office for National Statistics reviews the components of the Retail Price Index once every year, to keep it as up to date as possible, reflecting changes in consumers' preferences and the establishment of new products. Each year the changes are announced in a News Release and published in an article.
What are the origins of the Retail Prices?
Although there were occasional official comparisons of prices for food in the nineteenth and early twentieth century, the Government first began a systematic, continuous check on the increase of the cost of living in 1914, but the coverage was very limited. After the Second World War a cost of living Advisory Committee was set up and an experimental price index known as the Interim Index of Retail Prices ran from 1947 to 1956. In January 1956, the first official Retail Prices Index began with various methodological changes implemented since then following reviews by RPI Advisory Committees. The latest Advisory Committees met in the early 1990s and made recommendations about the treatment of housing costs, holidays and car prices.
RPIX, which excludes mortgage interest payments;
RPIY, which excludes mortgage interest rates and indirect taxes (VAT, council tax, duties vehicle excise duty, insurance tax and air passenger duty);
Quarterly Pensioner Indices, which use the same price data as RPI, weighted for the typical spending of one and two-pensioner households and excluding items such as school dinners, work place canteen meals and housing; and the
Tax and Price Index, which measures how much the average person's gross income needs to change to purchase the RPI basket after allowing for the average amount of income tax and national insurance paid on earnings.
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| 17/11/2009 | 10:00 | | | International Trade Balance yy | 3.7b | -0.2b | -4.0b | Sep | |
Country: EMU
Source: The Census Bureau and the Bureau of Economic Analysis of the Department of Commerce.
Raw Data Available At: http://www.census.gov/foreign-trade/www/press.html
Release Time: 8:30 ET around the 20th of the month (data for two months prior).
The trade report is most widely watched for trends in the overall trade balance. But trends in both exports and imports of goods and services bear watching as well. The export data in particular are important to watch for indications that a strengthening competitive position at home and/or strengthening economies overseas are boosting U.S. growth. Imports provide an indication of domestic demand, but given the severe lag of this report relative to other consumption indicators, it is not particularly valuable for this purpose.
The volatility in the monthly trade balance can play an important role in GDP forecasts. Net exports are a relatively volatile component of GDP, and the trade report provides the only early clues to the net export performance each quarter.
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| 17/11/2009 | 13:30 | | | Producer Price Index (PPI) yy | -1.9% | -1.8% | -4.8% | Oct | |
Country: US
Source: Bureau of Labor statistics, U.S. Department of Labor.
Raw Data Available At: http://stats.bls.gov/news.release/ppi.toc.htm
Release Time: Around the 11th of each month at 8:30 ET for the prior month.
The Producer Price Index measures prices of goods at the wholesale level. There are three broad subcategories within PPI: crude, intermediate, and finished. The market tracks the finished goods index most closely, as it represents prices for goods that are ready for sale to the end user. Goods prices at the crude and intermediate stages of production often provide an indication of coming (dis)inflationary pressures, but the closer you get to crude goods, the more that these prices track commodity prices which are already available in traded indexes such as the CRB (Commodity Research Bureau).
At all stages of production, the market places more emphasis on the index excluding food and energy, referred to as the core rate. Food and energy prices tend to be quite volatile and obscure trends in the underlying inflation rate. Though the market reaction is determined by the month/month changes, year/year changes are also noted by analysts. The index is not revised on a monthly basis, but annual revisions to seasonal adjustment factors can produce small adjustments to past releases.
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| 17/11/2009 | 13:30 | | | Producer Price Index (PPI) mm | 0.3% | 0.5% | -0.6% | Oct | |
Country: US
Source: Bureau of Labor statistics, U.S. Department of Labor.
Raw Data Available At: http://stats.bls.gov/news.release/ppi.toc.htm
Release Time: Around the 11th of each month at 8:30 ET for the prior month.
The Producer Price Index measures prices of goods at the wholesale level. There are three broad subcategories within PPI: crude, intermediate, and finished. The market tracks the finished goods index most closely, as it represents prices for goods that are ready for sale to the end user. Goods prices at the crude and intermediate stages of production often provide an indication of coming (dis)inflationary pressures, but the closer you get to crude goods, the more that these prices track commodity prices which are already available in traded indexes such as the CRB (Commodity Research Bureau).
At all stages of production, the market places more emphasis on the index excluding food and energy, referred to as the core rate. Food and energy prices tend to be quite volatile and obscure trends in the underlying inflation rate. Though the market reaction is determined by the month/month changes, year/year changes are also noted by analysts. The index is not revised on a monthly basis, but annual revisions to seasonal adjustment factors can produce small adjustments to past releases.
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| 17/11/2009 | 13:30 | | | Core PPI mm | -0.6% | 0.1% | -0.1% | Oct | |
Country: US
Source: Bureau of Labor statistics, U.S. Department of Labor.
Raw Data Available At: http://stats.bls.gov/news.release/ppi.toc.htm
Release Time: Around the 11th of each month at 8:30 ET for the prior month.
The Producer Price Index measures prices of goods at the wholesale level. There are three broad subcategories within PPI: crude, intermediate, and finished. The market tracks the finished goods index most closely, as it represents prices for goods that are ready for sale to the end user. Goods prices at the crude and intermediate stages of production often provide an indication of coming (dis)inflationary pressures, but the closer you get to crude goods, the more that these prices track commodity prices which are already available in traded indexes such as the CRB (Commodity Research Bureau).
At all stages of production, the market places more emphasis on the index excluding food and energy, referred to as the core rate. Food and energy prices tend to be quite volatile and obscure trends in the underlying inflation rate. Though the market reaction is determined by the month/month changes, year/year changes are also noted by analysts. The index is not revised on a monthly basis, but annual revisions to seasonal adjustment factors can produce small adjustments to past releases.
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| 17/11/2009 | 13:30 | | | Core PPI yy | 0.7% | 1.4% | 1.8% | Oct | |
Country: US
Source: Bureau of Labor statistics, U.S. Department of Labor.
Raw Data Available At: http://stats.bls.gov/news.release/ppi.toc.htm
Release Time: Around the 11th of each month at 8:30 ET for the prior month.
The Producer Price Index measures prices of goods at the wholesale level. There are three broad subcategories within PPI: crude, intermediate, and finished. The market tracks the finished goods index most closely, as it represents prices for goods that are ready for sale to the end user. Goods prices at the crude and intermediate stages of production often provide an indication of coming (dis)inflationary pressures, but the closer you get to crude goods, the more that these prices track commodity prices which are already available in traded indexes such as the CRB (Commodity Research Bureau).
At all stages of production, the market places more emphasis on the index excluding food and energy, referred to as the core rate. Food and energy prices tend to be quite volatile and obscure trends in the underlying inflation rate. Though the market reaction is determined by the month/month changes, year/year changes are also noted by analysts. The index is not revised on a monthly basis, but annual revisions to seasonal adjustment factors can produce small adjustments to past releases.
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| 17/11/2009 | 14:00 | | | Capital Flow | 133.5b | | 10.2b | Sep | |
Country: US
The Capital Account records a nation’s incoming and outgoing investment flows such as payments for entire or parts of companies (direct or portfolio investment), stocks, bonds, bank accounts, real estate and factories. The balance of payments is influenced by many factors, including the financial and economic climate of other countries.
Short-term capital movements
Short-term flows into liquid assets such as bank deposits and Treasury bills are easily reversed and are sometimes characterised as "hot money". Since flows can change direction at the drop of an interest rate, they can cause severe volatility in the currency markets.
Long-term capital movements
Long-term capital includes portfolio investment (stocks and shares) and direct investment (such as building a factory overseas). However, it is perhaps increasingly unrealistic to distinguish between investment in stocks and shares (long-term capital) and the acquisition of Treasury bills (short-term capital).
An outflow today implies current-account income in the future. Indeed, with global deregulation, it is easier for companies to raise their market share by setting up production facilities overseas. The initial direct investment shows as a capital-account outflow. Subsequently remitted profits add to current-account inflows and boost GNP relative to GDP. The value of goods sold, however, does not show up in external trade or increase GDP in the way that exports from home would.
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| 17/11/2009 | 14:15 | | | Capacity Utilization | 70.7% | 70.8% | 70.5% | Oct | |
Country: US
Source: Federal Reserve.
Raw Data Available At: http://www.federalreserve.gov/releases/G17/Current/g17.txt
Release Time: 9:15 ET around the 15th of the month (data for month prior).
The index of Industrial Production is a fixed-weight measure of the physical output of the nation's factories, mines, and utilities. Manufacturing production, the largest component of the total, can be accurately predicted using total manufacturing hours worked from the employment report. One of the bigger wildcards in this report is utility production, which can be quite volatile due to swings in the weather. Severe hot or cold spells can boost production as increased heating/cooling needs drive utility production up.
In addition to production, this monthly report also provides a measure of capacity utilization. Though the rate of capacity utilization is seen as a critical gauge of the slack available in the economy, the market does not completely trust this measure. Capacity is very difficult to measure, and the Fed essentially assumes that growth in capacity in any given year follows a straight line. One can therefore predict the capacity utilization rate quite accurately based on the assumption for production growth. The 85% mark is seen as a key barrier over which inflationary pressures are generated, but given revisions to these data and the difficulties with capacity measurement, the 85% mark should be viewed cautiously. It would be appropriate to look for corroborating inflation indications from commodity prices and vendor deliveries.
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| 17/11/2009 | 14:15 | | | Industrial Production mm | 0.1% | 0.4% | 0.7% | Oct | |
Country: US
Source: Federal Reserve.
Raw Data Available At: http://www.federalreserve.gov/releases/G17/Current/g17.txt
Release Time: 9:15 ET around the 15th of the month (data for month prior).
The index of Industrial Production is a fixed-weight measure of the physical output of the nation's factories, mines, and utilities. Manufacturing production, the largest component of the total, can be accurately predicted using total manufacturing hours worked from the employment report. One of the bigger wildcards in this report is utility production, which can be quite volatile due to swings in the weather. Severe hot or cold spells can boost production as increased heating/cooling needs drive utility production up.
In addition to production, this monthly report also provides a measure of capacity utilization. Though the rate of capacity utilization is seen as a critical gauge of the slack available in the economy, the market does not completely trust this measure. Capacity is very difficult to measure, and the Fed essentially assumes that growth in capacity in any given year follows a straight line. One can therefore predict the capacity utilization rate quite accurately based on the assumption for production growth. The 85% mark is seen as a key barrier over which inflationary pressures are generated, but given revisions to these data and the difficulties with capacity measurement, the 85% mark should be viewed cautiously. It would be appropriate to look for corroborating inflation indications from commodity prices and vendor deliveries.
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| 17/11/2009 | 18:00 | | | NAHB housing market INDEX | 17.0 | 19.0 | 18.0 | Nov | |
| Country: US |
| 18/11/2009 | 09:00 | | | Current Account | -5.4b | | -1.3b | Sep | |
Country: EMU
The most important part of international trade data. It is the broadest measure of sales and purchases of goods, services, interest payments and unilateral transfers. The entire merchandise trade balance is contained in the current account.
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| 18/11/2009 | 09:00 | | | Capital Flow | 28.0b | | 57.3b | Sep | |
Country: EMU
The Capital Account records a nation’s incoming and outgoing investment flows such as payments for entire or parts of companies (direct or portfolio investment), stocks, bonds, bank accounts, real estate and factories. The balance of payments is influenced by many factors, including the financial and economic climate of other countries.
Short-term capital movements
Short-term flows into liquid assets such as bank deposits and Treasury bills are easily reversed and are sometimes characterised as "hot money". Since flows can change direction at the drop of an interest rate, they can cause severe volatility in the currency markets.
Long-term capital movements
Long-term capital includes portfolio investment (stocks and shares) and direct investment (such as building a factory overseas). However, it is perhaps increasingly unrealistic to distinguish between investment in stocks and shares (long-term capital) and the acquisition of Treasury bills (short-term capital).
An outflow today implies current-account income in the future. Indeed, with global deregulation, it is easier for companies to raise their market share by setting up production facilities overseas. The initial direct investment shows as a capital-account outflow. Subsequently remitted profits add to current-account inflows and boost GNP relative to GDP. The value of goods sold, however, does not show up in external trade or increase GDP in the way that exports from home would.
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| 18/11/2009 | 09:30 | | | Protocol of last interest rate meeting | | | | | |
| Country: UK |
| 18/11/2009 | 11:00 | | | CBI Sales | -45.0 | -47.0 | -51.0 | Nov | |
Country: UK
Source: The Confederation of British Industry (CBI).
Raw Data Available At: http://www.cbi.org.uk/home.html
First introduced in 1983, this authoritative indicator of short-term trends in the UK retail and wholesale distribution sector carries significant weight in the formulation of economic policy at the Bank of England and within Government.
Quarterly and monthly surveys
Aimed at senior executives and sales managers and released on a monthly and quarterly basis, this quarterly survey tracks optimism, employment, prices, investment and stocks.
The monthly issue provides a vital update on volume of sales, orders and stocks.
A wealth of information
This timely guide to retail and wholesale trade is published within seven days of its closing date and covers:
1. Total distribution
2. Retail, wholesale and motor trade activity
3. Employment
4. Type of outlet
5. Twenty-three individual sectors
The importance of this survey's data is reflected in its regular supply to the European Commission's harmonised survey of retail trade.
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| 18/11/2009 | 12:00 | | | Core CPI mm | 0.1% | 0.0% | 0.3% | Oct | |
Country: Canada
Source: Bureau of Labor statistics, U.S. Department of Labor.
Raw Data Available At: http://stats.bls.gov/news.release/cpi.toc.htm
8:30 ET, about the 13th of each month for the prior month.
CPI can be greatly influenced in any given month by a movement in volatile food and energy prices. Therefore, it is important to look at CPI excluding food and energy, commonly called the "core rate" of inflation. Within the core rate, some of the more volatile and closely watched components are apparel, tobacco, airfares, and new cars. In addition to tracking the month/month changes in core CPI, the year/year change in core CPI is seen by most economists as the best measure of the underlying inflation rate. |
| 18/11/2009 | 12:00 | | | Core CPI yy | 1.8% | 1.7% | 1.5% | Oct | |
Country: Canada
Source: Bureau of Labor statistics, U.S. Department of Labor.
Raw Data Available At: http://stats.bls.gov/news.release/cpi.toc.htm
8:30 ET, about the 13th of each month for the prior month.
CPI can be greatly influenced in any given month by a movement in volatile food and energy prices. Therefore, it is important to look at CPI excluding food and energy, commonly called the "core rate" of inflation. Within the core rate, some of the more volatile and closely watched components are apparel, tobacco, airfares, and new cars. In addition to tracking the month/month changes in core CPI, the year/year change in core CPI is seen by most economists as the best measure of the underlying inflation rate. |
| 18/11/2009 | 12:00 | | | Consumer Price Index (CPI) mm | -0.1% | 0.1% | 0.0% | Oct | |
Country: Canada
Source: Bureau of Labor statistics, U.S. Department of Labor.
Raw Data Available At: http://stats.bls.gov/news.release/cpi.toc.htm
Release Time: 8:30 ET, about the 13th of each month for the prior month.
The Consumer Price Index is a measure of the price level of a fixed market basket of goods and services purchased by consumers. CPI is the most widely cited inflation indicator, and it is used to calculate cost of living adjustments for government programs and it is the basis of COLAs for many private labor agreements as well. It has been criticized for overstating inflation, because it does not adjust for substitution effects and because the fixed basket does not reflect price changes in new technology goods which are often declining in price. Despite these criticisms, it remains the benchmark inflation index.
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| 18/11/2009 | 12:00 | | | Consumer Price Index (CPI) yy | 0.1% | 0.3% | -0.9% | Oct | |
Country: Canada
Source: Bureau of Labor statistics, U.S. Department of Labor.
Raw Data Available At: http://stats.bls.gov/news.release/cpi.toc.htm
Release Time: 8:30 ET, about the 13th of each month for the prior month.
The Consumer Price Index is a measure of the price level of a fixed market basket of goods and services purchased by consumers. CPI is the most widely cited inflation indicator, and it is used to calculate cost of living adjustments for government programs and it is the basis of COLAs for many private labor agreements as well. It has been criticized for overstating inflation, because it does not adjust for substitution effects and because the fixed basket does not reflect price changes in new technology goods which are often declining in price. Despite these criticisms, it remains the benchmark inflation index.
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| 18/11/2009 | 13:30 | | | Building Permits | 0.552m | 0.58m | 0.575m | Oct | |
Country: US
Source: The Census Bureau of the Department of Commerce.
Raw Data Available At: http://www.census.gov/const/www/newresconstindex.html
Release Time: 8:30 ET around the 16th of the month (data for one month prior).
Housing Starts are a measure of the number of residential units on which construction is begun each month. A start in construction is defined as the beginning of excavation of the foundation for the building and is comprised primarily of residential housing. Building permits are permits taken out in order to allow excavation. An increase in building permits and starts usually occurs a few months after a reduction in mortgage rates. Permits lead starts, but permits are not required in all regions of the country, and the level of permits therefore tends to be less than the level of starts over time.
The monthly national report is broken down by region: Northeast, Midwest, South, and West. Briefing recommends analyzing the regional data because they are subject to a high degree of volatility. The high volatility can be attributed to weather changes and/or natural disasters. For example, an unexpectedly high level of rain in South could delay housing starts for the region.
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| 18/11/2009 | 13:30 | | | Core CPI mm | 0.2% | 0.1% | 0.2% | Oct | |
Country: US
Source: Bureau of Labor statistics, U.S. Department of Labor.
Raw Data Available At: http://stats.bls.gov/news.release/cpi.toc.htm
8:30 ET, about the 13th of each month for the prior month.
CPI can be greatly influenced in any given month by a movement in volatile food and energy prices. Therefore, it is important to look at CPI excluding food and energy, commonly called the "core rate" of inflation. Within the core rate, some of the more volatile and closely watched components are apparel, tobacco, airfares, and new cars. In addition to tracking the month/month changes in core CPI, the year/year change in core CPI is seen by most economists as the best measure of the underlying inflation rate. |
| 18/11/2009 | 13:30 | | | Consumer Price Index (CPI) mm | 0.3% | 0.2% | 0.2% | Oct | |
Country: US
Source: Bureau of Labor statistics, U.S. Department of Labor.
Raw Data Available At: http://stats.bls.gov/news.release/cpi.toc.htm
Release Time: 8:30 ET, about the 13th of each month for the prior month.
The Consumer Price Index is a measure of the price level of a fixed market basket of goods and services purchased by consumers. CPI is the most widely cited inflation indicator, and it is used to calculate cost of living adjustments for government programs and it is the basis of COLAs for many private labor agreements as well. It has been criticized for overstating inflation, because it does not adjust for substitution effects and because the fixed basket does not reflect price changes in new technology goods which are often declining in price. Despite these criticisms, it remains the benchmark inflation index.
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| 18/11/2009 | 13:30 | | | Core CPI yy | 1.7% | 1.6% | 1.5% | Oct | |
Country: US
Source: Bureau of Labor statistics, U.S. Department of Labor.
Raw Data Available At: http://stats.bls.gov/news.release/cpi.toc.htm
8:30 ET, about the 13th of each month for the prior month.
CPI can be greatly influenced in any given month by a movement in volatile food and energy prices. Therefore, it is important to look at CPI excluding food and energy, commonly called the "core rate" of inflation. Within the core rate, some of the more volatile and closely watched components are apparel, tobacco, airfares, and new cars. In addition to tracking the month/month changes in core CPI, the year/year change in core CPI is seen by most economists as the best measure of the underlying inflation rate. |
| 18/11/2009 | 13:30 | | | Consumer Price Index (CPI) yy | -0.2% | -0.3% | -1.3% | Oct | |
Country: US
Source: Bureau of Labor statistics, U.S. Department of Labor.
Raw Data Available At: http://stats.bls.gov/news.release/cpi.toc.htm
Release Time: 8:30 ET, about the 13th of each month for the prior month.
The Consumer Price Index is a measure of the price level of a fixed market basket of goods and services purchased by consumers. CPI is the most widely cited inflation indicator, and it is used to calculate cost of living adjustments for government programs and it is the basis of COLAs for many private labor agreements as well. It has been criticized for overstating inflation, because it does not adjust for substitution effects and because the fixed basket does not reflect price changes in new technology goods which are often declining in price. Despite these criticisms, it remains the benchmark inflation index.
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| 18/11/2009 | 13:30 | | | Housing Starts yy | 0.529m | 0.6m | 0.59m | Oct | |
Country: US
Source: The Census Bureau of the Department of Commerce.
Raw Data Available At: http://www.census.gov/const/www/newresconstindex.html
Release Time: 8:30 ET around the 16th of the month (data for one month prior).
Housing Starts are a measure of the number of residential units on which construction is begun each month. A start in construction is defined as the beginning of excavation of the foundation for the building and is comprised primarily of residential housing. Building permits are permits taken out in order to allow excavation. An increase in building permits and starts usually occurs a few months after a reduction in mortgage rates. Permits lead starts, but permits are not required in all regions of the country, and the level of permits therefore tends to be less than the level of starts over time.
The monthly national report is broken down by region: Northeast, Midwest, South, and West. Briefing recommends analyzing the regional data because they are subject to a high degree of volatility. The high volatility can be attributed to weather changes and/or natural disasters. For example, an unexpectedly high level of rain in South could delay housing starts for the region.
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| 19/11/2009 | 07:15 | | | International Trade Balance mm | 2463m | | 1918.0m | Oct | |
Country: Switzerland
Source: The Census Bureau and the Bureau of Economic Analysis of the Department of Commerce.
Raw Data Available At: http://www.census.gov/foreign-trade/www/press.html
Release Time: 8:30 ET around the 20th of the month (data for two months prior).
The trade report is most widely watched for trends in the overall trade balance. But trends in both exports and imports of goods and services bear watching as well. The export data in particular are important to watch for indications that a strengthening competitive position at home and/or strengthening economies overseas are boosting U.S. growth. Imports provide an indication of domestic demand, but given the severe lag of this report relative to other consumption indicators, it is not particularly valuable for this purpose.
The volatility in the monthly trade balance can play an important role in GDP forecasts. Net exports are a relatively volatile component of GDP, and the trade report provides the only early clues to the net export performance each quarter.
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| 19/11/2009 | 09:30 | | | Retail Sales mm | 0.4% | 0.5% | 0.0% | Oct | |
Country: UK
Source: The Census Bureau of the Department of Commerce.
Raw Data Available At: http://www.census.gov/svsd/www/advtable.html
Release Time: 8:30 ET around the 13th of the month (data for one month prior).
The retail sales report is a measure of the total receipts of retail stores. The changes in retail sales are widely followed as the most timely indicator of broad consumer spending patterns. Retail sales are often viewed ex-autos, as auto sales can move sharply from month-to-month. It is also important to keep an eye on the gas and food components, where changes in sales are often a result of price changes rather than shifting consumer demand.
Retail sales can be quite volatile and the advance reports are subject to rather large revisions. Retail sales do not include spending on services, which makes up over half of total consumption. Total personal consumption is not available until the personal income and consumption reports are released, typically two weeks after retail sales.
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| 19/11/2009 | 09:30 | | | Retail Sales yy | 3.4% | 2.9% | 2.4% | Oct | |
Country: UK
Source: The Census Bureau of the Department of Commerce.
Raw Data Available At: http://www.census.gov/svsd/www/advtable.html
Release Time: 8:30 ET around the 13th of the month (data for one month prior).
The retail sales report is a measure of the total receipts of retail stores. The changes in retail sales are widely followed as the most timely indicator of broad consumer spending patterns. Retail sales are often viewed ex-autos, as auto sales can move sharply from month-to-month. It is also important to keep an eye on the gas and food components, where changes in sales are often a result of price changes rather than shifting consumer demand.
Retail sales can be quite volatile and the advance reports are subject to rather large revisions. Retail sales do not include spending on services, which makes up over half of total consumption. Total personal consumption is not available until the personal income and consumption reports are released, typically two weeks after retail sales.
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| 19/11/2009 | 09:30 | | | Consumer Credit mm | 11.41b | 6.10b | 14.812b | Oct | |
Country: UK
Source: Federal Reserve.
Raw Data Available At: http://www.census.gov/const/www/c30index.html
Release Time: 15:00 ET on the fifth business day of the month (data for two months prior).
This monthly measure of consumer debt is volatile and subject to massive revisions. It is also released well after every other consumer spending indicator, including weekly chain store sales, auto sales, consumer confidence, retail sales, and personal consumption. For these reasons, the market almost never reacts to the consumer credit report.
Consumer credit is broken down into three categories: auto, revolving (ie, credit card), and other. Since we already have indications on total consumer spending well before this release, there is little to be gained from learning what portion of spending was financed through acquisition of debt. Periods of strong spending can be accompanied by relatively weak credit growth and vice versa, so this measure fails even as a coincident or lagging indicator.
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| 19/11/2009 | 09:30 | | | M3 Money Supply yy | 1.8% | | 0.8% | Oct | |
Country: UK
Source: Federal Reserve Board.
Raw Data Available At: http://www.bog.frb.fed.us/releases/H6/Current/
Release Time: Every Thursday at 16:30 ET, data for the week ended two Mondays prior.
M1: Currency + travelers checks + demand deposits + other checkable deposits (NOW accounts).
M2: M1 + savings deposits + small time deposits + retail money market funds. Also, see release details.
M3: M2 + large time deposits + institutional money market funds + RPs + Eurodollars.
In Brief
Money supply figures, and M1 specifically, once were the most important release to watch in the Treasury market, as the Fed directly targetted M1 growth in the early 1980s. The focus on money supply has long since been abandoned, however. To the extent that money supply is still monitored by the market, M2 is the favored monetary aggregate. The Fed still targets both M2 and M3 in a rhetorical sense, but these targets mean little when it comes to policy decisions. If the Fed misses its target, it is more likely to change the target than it is to change policy. In 2000, the Fed finally abandoned the targets altogether, thereby removing any remaining emphasis on this one-time star release.
In DepthThough money supply measures were long ago relegated to the bottom of the Fed's list of policy tools, they are still useful in providing clues regarding the strength of the economy. This article offers a refresher on just what the monetary aggregates are - how they are constructed, why they matter, and how much the Fed cares about each. Let's start with the strict definitions.
M1, the narrowest of the monetary aggregates, contains the following:
1. Currency, except that held by the Fed, Treasury, or banks/thrifts 2. Travelers checks 3. Demand deposits (non-interest bearing checking accounts), except those due to banks, the government, or foreign institutions 4. Other checkable deposits - most notably NOW (negotiable order of withdrawal) accounts.
M2, the aggregate which the Fed watches most closely, contains the following:
1. M1
2. Savings deposits (including money market deposit accounts- MMDAs)
3. Time deposits (known commonly as CDs or certificates of deposit) in denominations of less than $100,000
4. Balances in retail money market funds (retail funds have minimum initial investments of less than $50,000)
Finally, M3 - the broadest aggregate - contains:
1. M2
2. Time deposits in denominations of $100,000 or more
3. Balances in institutional money market funds (minimum investments of more than $50,000)
4. Overnight and term repurchase agreements
5. Overnight and term eurodollars held by U.S. residents
The Decline of M1
In the early 1980s, M1 was directly targetted by the Federal Reserve, and its weekly release was of critical importance to the financial markets. Today, M1 is barely noticed, and its stock continues to decline. The reason for M1's demise as a useful indicator is financial deregulation, which enabled individuals to hold transaction balances in accounts such as MMDAs which were not included in M1. More recently, M1 has lost what little usefulness it had left as sweep accounts have undermined the narrow aggregate.
Sweeps-stakes
Sweep accounts are a hybrid checking account/savings account. In a typical sweep account, banks will sweep part of a NOW account's balance into an MMDA. As funds are needed to cover checks written against the NOW account, the bank will periodically shift funds from the MMDA back into the NOW account. Since the legal maximum number of withdrawals from an MMDA is six per month, all funds will be shifted back to the NOW account on the sixth transaction of the month.
Sweep accounts benefit both banks and depositors. Banks benefit because MMDAs do not require any reserves to be held with the Fed, while NOW accounts are reservable. As these required reserves are non-interest bearing, banks benefit by reducing their level of required reserves. Depositors benefit because MMDAs carry higher interest rates, and thus earnings on checking balances are increased.
As NOW accounts are in M1 and MMDAs are in M2, M1 has been dramatically weakened by sweeps, while M2 has not been affected (since M2 already includes M1, a shift from a NOW account to an MMDA has no impact on M2).
The Rise and Fall and Rise of M2
M2 is the most closely watched monetary aggregate - both by economists and the Federal Reserve. The 1978 Humphrey-Hawkins Act mandated that the Fed set annual targets for money supply and that the Fed Chairman report to Congress twice each year regarding these targets. The Fed used to take that responsibility quite seriously - setting point targets for M1 growth, and later setting target ranges for M2 and M3. Finally, in 2000, the Fed abandoned these money targetting altogether.
T
he reduced emphasis on M2 first became evident in the late 1980s but was sealed in the early 1990s. M2 is a useful indicator only so long as its velocity (the rate of turnover of a dollar of M2, or mathematically, nominal GDP divided by M2) is stable over the long term. Unfortunately, the long term stability of M2 velocity, which was at the core of monetarism, disappeared beginning in the late 1980s. Banks and thrifts, devastated by nonperforming assets, pulled back from their traditional lending business, with market financing sources picking up the slack. The result was a break from the long term trend in M2 velocity. Suddenly, one dollar of M2 could fund far more nominal GDP growth, as market financing increased the efficiency of the financial system. Regardless of the hows and whys - which are still debated by economists - the bottom line was that M2 was no longer a reliable indicator.
It will take many years of predictable velocity before the Fed once again places much emphasis on M2 in its policy deliberations. And it is safe to say that neither M2 nor any other monetary aggregate will occupy the top spot in policy making as M1 did in the early 1980s. The record of interest rate targetting has simply been much better than that of money targetting.
M3: Still Bringing Up the Rear
M3 attracts more attention than it did previously, due largely to the demise of M1, but its inclusion of institutional accounts makes it less attractive than M2, which focusses on individual deposit accounts. The bottom line in determining which aggregate receives the most attention is the relative stability of its velocity. Even though M2 velocity went off course in the early 1990s, it has still been the most predictable of the three during the postwar period.
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| 19/11/2009 | 13:30 | | | Initial Jobless Claims | 505.0k | 505.0k | 502.0k | L/W | |
Country: US
Source: The Employment and Training Administration of the Department of Labor.
Raw Data Available At: http://www.dol.gov/opa/media/press/eta/main.htm
Release Time: 8:30 ET each Thursday (data for week ended prior Saturday).
This survey measures the attitudes and expectations concerning both present and future economic conditions of 500 consumers. The Michigan index is almost identical to the Conference Board Consumer Confidence index, though there are two monthly releases, a preliminary and final reading. Like the Conference Board index, it has two subindexes - expectations and current conditions. The expectations index is a component of the Conference Board's Leading Indicators index. |
| 19/11/2009 | 13:30 | | | Wholesale Trade | 0.2% | 1.4% | -1.4% | Sep | |
Country: Canada
Source: The Census Bureau of the Department of Commerce.
Raw Data Available At: http://www.census.gov/svsd/www/mwts.html
Release Time: 10:00 ET around the fifth business day of the month (data for two months prior).
The wholesale trade report includes sales and inventory statistics from the second stage of the manufacturing process. The sales figures say close to nothing about personal consumption and therefore do not move the market.
Wholesale inventories sometimes swing enough to change the aggregate inventory profile (aggregate inventory is the sum of inventory at the manufacturing, wholesale, and retail levels), which may affect the GDP outlook. In that event they can elicit a small market reaction. More often than not, however, this release goes unnoticed except by market economists.
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| 19/11/2009 | 13:30 | | | Leading Economic Indicators | 0.7% | 0.7% | 1.1% | Oct | |
Country: Canada
Source: The Conference Board.
Raw Data Available At: http://www.tcb-indicators.org/
Release Time: 8:30 ET around the third week of the month for the month prior.
In Brief
The Leading Indicators report is, for the most part, a compendium of previously announced economic indicators: new orders, jobless claims, money supply, average workweek, building permits, and stock prices. Therefore, the report is extremely predictable and of very little interest to the market. Though this series does have some predictive qualities, it is a common criticism that it has predicted "nine of the last six" recessions.
The Commerce Department previously published the leading indicators series. The collection and publishing of these data is now done by the non-profit Conference Board, which also produces the Consumer Confidence index.
In Depth
Purpose
The purpose of the leading index is straightforward: It is designed to signal turning points in the business cycle.
Composition
The index of leading indicators includes the ten economic statistics listed below.
1. The interest rate spread between 10-year Treasury notes and the federal funds rate.
2. The inflation-adjusted, M2 measure of the money supply.
3. The average manufacturing workweek.
4. Manufacturers' new orders for consumer goods and materials.
5. The S&P 500 measure of stock prices.
6. The vendor performance component of the NAPM index.
7. The average level of weekly initial claims for unemployment insurance.
8. Building permits.
9. The University of Michigan index of consumer expectations.
10. Manufacturers' new orders for nondefense capital goods.
The Conference Board, the organization that produces the leading index, standardizes these variables according to their individual weights in order to construct a composite leading index. Note that we have listed the components in order of importance. The difference between 10-year Treasuries and the fed funds rate carries the most weight; historically, this approximation of the slope of the yield curve has proven relatively more successful than other components at predicting future economic activity. Along those same lines, orders for nondefense capital goods carry the smallest weight because they have typically proven relatively poorer at pointing to changes in the direction of economic growth at large.
Performance
The leading index receives plenty of criticism. Indeed, skeptics often joke that it has correctly signalled nine of the last six recessions. Meanwhile, in its literature, The Conference Board cites the lead times with which the leading index has correctly predicted economic downturns. It is thus fair to ask whether the leading index is useless or priceless.
The answer lies somewhere in between. The charge that the index predicts recessions that do not come to fruition--and fails to warn of those that do--is hardly a fair criticism. No forecaster, even armed with an arsenal of economic statistics, has a perfect track record when it comes to predicting recessions. It is therefore unreasonable to assume that a ten-component index can do any better. That said, the index does have some reliability problems. For example, it failed to turn down prior to the 1990-91 recession, and in 1995 it signalled a downturn that never came to pass.
Usefulness
The leading index is more useful now that The Conference Board has taken control of it (the Department of Commerce stopped producing it at the end of 1996). Conference Board researchers quickly scrapped two of the old components--the change in sensitive materials prices and unfilled orders for durable goods--and added the interest-rate spread that appears in our list above. The index now lacks a wholesale price term, which some see as critical to determining future demand and inflation trends, but on net the new index emits less pronounced false signals and does a better job than it used to.
Briefing finds the leading index most helpful when we can make a statement like this: The leading index has decreased only once during the past year. Of course, even a strong trend like that does not guarantee that a recession will not form over the coming six to nine months. But we can get additional help from looking at the leading index with the coincident index, which is also published by The Conference Board, and alongside a couple of other leading indices published by Columbia University. Indeed, there exists much research that deals with the criteria for determining recession warnings (i.e., the leading index must fall during four of seven months and the coincident index must fall for three straight months).
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| 19/11/2009 | 15:00 | | | Leading Economic Indicators | 0.3% | 0.5% | 1.0% | Oct | |
Country: US
Source: The Conference Board.
Raw Data Available At: http://www.tcb-indicators.org/
Release Time: 8:30 ET around the third week of the month for the month prior.
In Brief
The Leading Indicators report is, for the most part, a compendium of previously announced economic indicators: new orders, jobless claims, money supply, average workweek, building permits, and stock prices. Therefore, the report is extremely predictable and of very little interest to the market. Though this series does have some predictive qualities, it is a common criticism that it has predicted "nine of the last six" recessions.
The Commerce Department previously published the leading indicators series. The collection and publishing of these data is now done by the non-profit Conference Board, which also produces the Consumer Confidence index.
In Depth
Purpose
The purpose of the leading index is straightforward: It is designed to signal turning points in the business cycle.
Composition
The index of leading indicators includes the ten economic statistics listed below.
1. The interest rate spread between 10-year Treasury notes and the federal funds rate.
2. The inflation-adjusted, M2 measure of the money supply.
3. The average manufacturing workweek.
4. Manufacturers' new orders for consumer goods and materials.
5. The S&P 500 measure of stock prices.
6. The vendor performance component of the NAPM index.
7. The average level of weekly initial claims for unemployment insurance.
8. Building permits.
9. The University of Michigan index of consumer expectations.
10. Manufacturers' new orders for nondefense capital goods.
The Conference Board, the organization that produces the leading index, standardizes these variables according to their individual weights in order to construct a composite leading index. Note that we have listed the components in order of importance. The difference between 10-year Treasuries and the fed funds rate carries the most weight; historically, this approximation of the slope of the yield curve has proven relatively more successful than other components at predicting future economic activity. Along those same lines, orders for nondefense capital goods carry the smallest weight because they have typically proven relatively poorer at pointing to changes in the direction of economic growth at large.
Performance
The leading index receives plenty of criticism. Indeed, skeptics often joke that it has correctly signalled nine of the last six recessions. Meanwhile, in its literature, The Conference Board cites the lead times with which the leading index has correctly predicted economic downturns. It is thus fair to ask whether the leading index is useless or priceless.
The answer lies somewhere in between. The charge that the index predicts recessions that do not come to fruition--and fails to warn of those that do--is hardly a fair criticism. No forecaster, even armed with an arsenal of economic statistics, has a perfect track record when it comes to predicting recessions. It is therefore unreasonable to assume that a ten-component index can do any better. That said, the index does have some reliability problems. For example, it failed to turn down prior to the 1990-91 recession, and in 1995 it signalled a downturn that never came to pass.
Usefulness
The leading index is more useful now that The Conference Board has taken control of it (the Department of Commerce stopped producing it at the end of 1996). Conference Board researchers quickly scrapped two of the old components--the change in sensitive materials prices and unfilled orders for durable goods--and added the interest-rate spread that appears in our list above. The index now lacks a wholesale price term, which some see as critical to determining future demand and inflation trends, but on net the new index emits less pronounced false signals and does a better job than it used to.
Briefing finds the leading index most helpful when we can make a statement like this: The leading index has decreased only once during the past year. Of course, even a strong trend like that does not guarantee that a recession will not form over the coming six to nine months. But we can get additional help from looking at the leading index with the coincident index, which is also published by The Conference Board, and alongside a couple of other leading indices published by Columbia University. Indeed, there exists much research that deals with the criteria for determining recession warnings (i.e., the leading index must fall during four of seven months and the coincident index must fall for three straight months).
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| 19/11/2009 | 15:00 | | | Philadelphia Fed Survey | 16.7 | 12.0 | 11.5 | Nov | |
Country: US
Source: Chicago Purchasing Managers Association.
Raw Data Available At: http://www.phil.frb.org/
Release Time: Last business day of the month at 10 ET for the current month.
In Brief
There are many regional manufacturing surveys, and they tend to be ranked in order of timeliness and the importance of the region. The Philadelphia Fed's survey is first each month, actually coming out during the third week of the month for which it is reporting. Several smaller surveys are then released before the Chicago purchasing managers' report on the last day of each month. A few, such as the Atlanta and Richmond Fed surveys, are released after the NAPM and are of little value. The purchasing managers' reports are measured like the national NAPM - 50% marks the breakeven line between an expanding and contracting manufacturing sector. For the Philadelphia and Atlanta Fed indexes, 0 is the breakeven mark.
These surveys can be of some help in forecasting the national NAPM - particularly the Philadelphia and Chicago surveys which are more closely watched due to their timeliness and the fact that these regions represent a reasonable cross section of national manufacturing activities.
In Depth
The market has been bombarded with a bevy of surveys purporting to measure manufacturing activity in every nook and cranny of the country. First it was Philadelphia, then Chicago, and Detroit, Milwaukee, New York, Cincinnati, Richmond, Atlanta, Boston, and there might as well have been a Nome survey. This hodge-podge of releases is begging for someone - namely us - to come along and cut this group down to a more manageable size.
Nuts and Bolts
Let's start with the issue of what these manufacturing surveys are trying to measure and how they go about doing it. The leader of this pack of regional surveys is the ISM index which comes from the Institute for Supply Management (formerly the National Association of Purchasing Managers). It has been around since 1931 (1948 on an uninterrupted basis), it is national, and it is one of the most timely measures of manufacturing activity available. In other words, it sets the standards by which its progeny are measured.
The ISM index is actually a composite of five sub-indexes - new orders, production, supplier deliveries, inventories, and employment. In surveying over 300 companies each month, the ISM asks for positive, negative, or unchanged readings on each of these indicators. The positive responses are added to one half of the unchanged responses to produce the diffusion index. For example, if 50% of respondents reported stronger orders, 40% reported weaker, and 10% unchanged, the diffusion index for orders would be 55%, the 50% positive plus half of the 10% unchanged. To calculate the total index, the ISM uses weights for the five indicators, which are as follows: 30% new orders, 25% production, 20% employment, 15% supplier deliveries, and 10% inventories.
The Selection Criteria
Since this methodology has made the ISM index one of the better leading indicators of economic activity over the years, we will measure the usefulness of the regional indexes based on their ability to help in forecasting the national index. In our effort to arrive at the most important regional indices, these criteria make eliminating most of the candidates easy for one simple reason - they are released after the national index. While regional economic developments are of interest to those who live in the region, they are not particularly important to the markets. If a region cannot help in forecasting national trends, then its data are not particularly useful. So say adios to Atlanta, Richmond, Kansas City, and who knows how many others which have cropped up in recent years.
And the Winner Is...
Let's focus on the regional surveys which precede the release of the national index on the first business day of each month (with data for the prior month). The contestants are Philadelphia, Chicago, Milwaukee, Detroit, New York, and the most recent addition to the bunch - the APICS survey. We looked at the correlation of all of these indexes to the national NAPM and found substantial differences in their forecasting ability. The winners are...drum roll please...Chicago and Philadelphia, in that order.
The Chicago PMI (officially known as the Business Barometer) is a monthly composite index based on opinion surveys of more than 200 Chicago purchasing managers regarding the manufacturing industry. The survey responses are limited to three options: slower, faster and same. As such, the index will not capture if a component is growing but at a much slower rate or vice versa. The index is a composite of seven similarly constructed indexes including: new orders, production, supplier delivery times, backlogs, inventories, prices paid, and employment. New orders and orders backlog indices indicate future production activity. It signals factory-sector expansion when it is above 50 and contraction when below it. The index is seasonally adjusted for the effects of variations within the year, differences due to holidays and institutional changes. Because it is an opinion survey, it is often influenced by respondents’ perception of current events, as opposed to actual hard data. Also, it does not capture technological
and production changes, which make it possible for production to expand, while employment contracts. Because the Chicago PMI is released the day before the ISM, it is watched in order to predict the more important ISM report (the Chicago PMI has an impressive 91% correlation with the ISM national NAPM), which is in itself a good leading indicator of overall economic activity. It frequently moves markets.
The Philadelphia Fed index, which is released on the third Thursday of the month (with data for the same month), was a distant second at 76%. Philly Fed's performance improved slightly to 78% when Briefing measured its results using the NAPM methodology. The Philly index as released is not a composite of its subindexes, as the NAPM is. Instead, the Philly Fed survey asks many questions, but the total index is based on the general question "are business conditions better or worse than last month." It is often the case that a weighted measure of the individual questions on specifics such as new orders and production moves in a different direction than the index based on the general question.
The rest of the regional indexes fared poorly, ranging from correlations as poor as 55% (APICS) to 73% (Milwaukee). Chicago was the clear winner, but the Philly Fed index definitely deserves recognition, particularly since it is released so much earlier than the rest. In the future, then, we would recommend setting aside most of the regional manufacturing surveys and focussing on just Philly and Chicago, which offer the best hope of predicting the national index. And when you look at the Philly index, improve your chances by looking at the Philly numbers calculated on an NAPM basis, which Briefing will be happy to provide.
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| 20/11/2009 | | | | Interest Rate Decision | 0.1% | 0.1% | 0.1% | Nov | |
Country: Japan
Source (U.S.): The Federal Reserve Open Market Committee - FOMC.
Source (World): The Central Bank Monetary Policy Committee - MPC.
The Federal Open Market Committee is a twelve-member committee made up of the seven members of the Board of Governors and five Federal Reserve Bank presidents. It meets eight times per year to determine the near-term direction of monetary policy, such as setting guidelines for the purchase and sale of government securities and setting policy relating to System operations in the foreign exchange markets. These changes in monetary policy are now announced immediately after FOMC meetings. Most importantly, the Fed determines interest rate policy at FOMC meetings. Market participants speculate about the possibility of an interest rate change at these meetings, and if the outcome is different from expectations, the impact on the markets can be dramatic and far-reaching. The interest rate set by the Fed the federal funds rate serves as a benchmark for all other rates. A change in the fed funds rate, the lending rate banks charge each other for the use of overnight funds, translates directly through to all other interest rates from Treasury bonds to mortgage loans. It also changes the dynamics of competition for investor dollars: when bonds yield 10 percent, they will attract more money away from stocks then when they only yield 5 percent. The level of interest rates affects the economy higher rates tend to slow activity; lower rates stimulate activity, a ripple effect that expands into all sectors of the economy.
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| 20/11/2009 | 07:00 | | | Producer Price Index (PPI) mm | 0.0% | 0.1% | -0.5% | Oct | |
Country: Germany
Source: Bureau of Labor statistics, U.S. Department of Labor.
Raw Data Available At: http://stats.bls.gov/news.release/ppi.toc.htm
Release Time: Around the 11th of each month at 8:30 ET for the prior month.
The Producer Price Index measures prices of goods at the wholesale level. There are three broad subcategories within PPI: crude, intermediate, and finished. The market tracks the finished goods index most closely, as it represents prices for goods that are ready for sale to the end user. Goods prices at the crude and intermediate stages of production often provide an indication of coming (dis)inflationary pressures, but the closer you get to crude goods, the more that these prices track commodity prices which are already available in traded indexes such as the CRB (Commodity Research Bureau).
At all stages of production, the market places more emphasis on the index excluding food and energy, referred to as the core rate. Food and energy prices tend to be quite volatile and obscure trends in the underlying inflation rate. Though the market reaction is determined by the month/month changes, year/year changes are also noted by analysts. The index is not revised on a monthly basis, but annual revisions to seasonal adjustment factors can produce small adjustments to past releases.
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| 20/11/2009 | 07:00 | | | Producer Price Index (PPI) yy | -7.6% | -7.4% | -7.6% | Oct | |
Country: Germany
Source: Bureau of Labor statistics, U.S. Department of Labor.
Raw Data Available At: http://stats.bls.gov/news.release/ppi.toc.htm
Release Time: Around the 11th of each month at 8:30 ET for the prior month.
The Producer Price Index measures prices of goods at the wholesale level. There are three broad subcategories within PPI: crude, intermediate, and finished. The market tracks the finished goods index most closely, as it represents prices for goods that are ready for sale to the end user. Goods prices at the crude and intermediate stages of production often provide an indication of coming (dis)inflationary pressures, but the closer you get to crude goods, the more that these prices track commodity prices which are already available in traded indexes such as the CRB (Commodity Research Bureau).
At all stages of production, the market places more emphasis on the index excluding food and energy, referred to as the core rate. Food and energy prices tend to be quite volatile and obscure trends in the underlying inflation rate. Though the market reaction is determined by the month/month changes, year/year changes are also noted by analysts. The index is not revised on a monthly basis, but annual revisions to seasonal adjustment factors can produce small adjustments to past releases.
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