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Economic indicators, which are used to assess the situation in the economies of most developed countries
• Gross domestic product (GDP) the main indicator used to assess the state of the economy. Often GDP is calculated by the following formula: GDP = PT + PR + G + Ex - Imp (here PT is consumption, In investment, G is government expenditure, Ex is exports, Imp – import). GDP is calculated as the ratio of the current value to the value for the previous period, or the absolute value of the sum of the prices for domestically produced goods and services. The value of this index positively and significantly affects the market – especially in case of divergence with previous estimates. GDP growth leads to an increase of the exchange rate.Typically, the indices are calculated quarterly and are published chronologically in the following order: advanced --> refined --> final (advance --> revised --> final).
• The consumer price index (CPI) - shows the level of retail prices for the so-called "consumer basket" that includes a specific set of goods and services. In calculating its value takes into account the prices for imported goods. The consumer price index is used as the main indicator of inflation in the country. Has a definite and noticeable impact on the currency market. To conduct a meaningful cumulative analysis of the consumer price index with producer price index (PPI).If the situation in the economy is close to normal, the growth of CPI and PPI data could push the Central Bank to increase interest rates, which in turn will lead upward pressure on the exchange rate, and for obvious reasons - because then it is increasing the attractiveness of investing in high-yield currency.
• The consumer price index excluding food and energy (Core CPI) - the consumer price index is less susceptible to market changes than the "normal" index, and is considered more reliable. Usually both indexes are published at the same time.
• The producer price index (PPI) the index tracks changes in prices of a "basket" of goods produced in the industry of a particular country. Earlier often used the name "wholesale price index (wholesale price index). Usually the index is presented in two components – the input prices (components, semi-finished products, etc.) and output (price of the finished product). Weekend prices include the cost of labour and reflect the level of inflation associated with its fluctuations. The PPI is also calculated and excluding food and energy (Core PPI).When the calculation does not take into account imported goods and services. Its impact on the market unobtrusive.
• Consumer credit (Consumer credit) - evaluation of volume of use of credit by consumers of a particular country with the help of credit cards, personal loans and purchases in installments. Used as an indicator of consumer demand. The survey shows that consumers tend to "borrow" to better meet their needs. But the data indicator is often subject to revision and is subject to appreciable seasonal fluctuations, especially in the run up to Christmas and New year. Market impact this indicator is not too large.The growth index is considered as a positive factor for the economy and, consequently, leads to the rise of its currency.
• Industrial output (Industrial production) - shows the change in the volume of industrial production in a particular country. Consists of the aggregate output of manufacturing industry (manufacturing) and the volumes upstream and downstream industries, and in utilities. Account is also taken of woodworking and the production of electricity. Is one of the main indicators of the economy of the country. Due to the fact that in developed countries, prevailing over production is the services sector, this indicator is not decisive for the reflection of economic development.Its impact on the market is quite noticeable, but the index usually helps the growth of the national currency.
• The balance of payments (Current account balance) – this indicator is essentially a ratio of the amount of payments coming into the country from abroad and the amounts of payments from abroad. If the first exceeds the second then the balance of payments is active (surplus), otherwise it is passive (negative balance). To have the most impact on the currency market. A positive balance of payments or a reduction in the negative balance will have a positive impact on the national currency.
• Retail sales (Retail sales) – index change in the volume of sales in retail trade, and accordingly, the level of demand and consumer spending. The index is calculated in two types – General and "excluding auto sales (Core Retail Sales), and more reliable is considered the second option. Published both simultaneously. The market closely monitors these publications. The growth of retail sales is positive for the national economy, and this usually leads to an increase in the exchange rate.
• Trade balance (Trade balance) – calculated as the ratio of the sum of the prices of goods that were exported from this country, and the sum of the prices of the imported product, in other words, is the difference between exports and imports. If exports in total exceed imports, the trade balance is active (surplus), if on the contrary-that passive (negative balance). The indicator is not especially powerful, but it is clear that the growth of imports is evidence of the growth of consumption and export growth reflects the growth in domestic production.A positive balance and reducing the deficit will promote growth of the national currency.
• The unemployment rate (Unemployment rate) is the ratio of the number of registered unemployed to total working age population of the country. Increasing unemployment, even despite the fact that this is a measure of the efficiency of use of labour force will pose a threat to economic growth of the country, because this situation is not conducive to consumption. The indicator has a very strong impact on the markets in Europe, especially in Germany and North America. The indicator follow politicians and officials of Central banks, given its in their decisions and financial policies.
|Category: Forex | Added by: (29.10.2017)