There are four recurring economic events that investors commonly pay attention to: FOMC meetings and the release of PPI, CPI and PCE reports.
Federal Open Market Committee (FOMC) meetings happen eight times per year. These are where, among other things, the Federal Reserve decides whether to hold interest rates steady, raise them or lower them. Why should you care? Rate changes affect borrowing costs across the economy, and unexpected changes can quickly affect stock prices.
The other three reports are monthly measures of inflation. The producer price index (PPI) tracks price changes for goods and materials before they reach consumers. The consumer price index (CPI) tracks the price changes for food, gasoline, clothing, shelter and other common expenses. The personal consumption expenditures (PCE) price index is similar to the CPI but is the Fed’s preferred inflation gauge, since it captures broader spending patterns.
Why should these reports be on your radar? An unexpected change in one or more of them can shift expectations for interest rates, which can move markets even more than the data itself.
Many investors feel real anxiety around these releases. It can seem like the numbers carry too much weight or like Wall Street has an unfair data advantage.
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JOHN L from NJ posted about 8 hours ago:
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