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What is the US Core Consumer Price Index (CPI)?
The US Core Consumer Price Index (CPI) is a measure of inflation that excludes the prices of volatile items such as food and energy, in order to provide a more accurate picture of underlying inflationary trends in the economy. And inflation is the rate at which the general level of prices of goods and services rises, which means that the purchasing power of money decreases over time. By tracking changes in the price of a basket of goods and services purchased by consumers, the CPI provides an important indicator of changes in the cost of living over time.
The core CPI is particularly useful because it excludes food and energy prices, which can be highly volatile and subject to frequent and unpredictable fluctuations. By focusing on the remaining items in the basket, such as housing, transportation, health care, and education, the core CPI is a more stable and reliable measure of underlying inflationary pressures in an economy.
If the monthly US core CPI release is greater than expected, it means that the inflation rate in the economy is higher than expected. This can have important implications for financial markets, as investors may adjust their expectations about future interest rates and the behavior of asset prices in response to new information.
A larger-than-expected CPI release could also have implications for monetary policy, as Federal Reserve policymakers may view the data as evidence that the economy is overheating and may need to raise interest rates to combat inflationary pressures. On the other hand, if the CPI release is smaller than expected, it may indicate that the economy is experiencing weaker-than-expected growth, which could lead to lower interest rates and a more accommodative monetary policy stance.
If the US core CPI release is lower than expected, it means that the rate of inflation in the economy is lower than expected. This can have important implications for financial markets, as investors may adjust their expectations about future interest rates and the behavior of asset prices in response to new information.
A lower-than-expected CPI release could also have implications for monetary policy, as Federal Reserve policymakers may view the data as evidence that the economy is experiencing weaker-than-expected growth, which could lead to a more accommodative monetary policy stance. . Lower inflation also means that consumers may have more purchasing power, which could boost consumer spending and spur economic growth.
How does the US Core Consumer Price Index (CPI) monthly affect the trading of the US dollar in the forex market?
Benefiting from the US monthly Consumer Price Index (CPI) report can have a significant impact on the trading of the US dollar in the forex market.
If the release of the US core CPI is higher than expected, indicating rising inflationary pressures, this could increase the possibility of the Federal Reserve raising interest rates in the near future. This can attract foreign investors to the US dollar, as higher interest rates can lead to higher returns on investment. As a result, the US dollar may appreciate against other currencies in the forex market.
Conversely, if the release of the US core CPI is lower than expected, indicating easing inflationary pressures, this could reduce the likelihood of the Fed raising interest rates in the near future. This can cause foreign investors to turn away from the US dollar, as lower interest rates can lower investment returns. As a result, the value of the US dollar may depreciate against other currencies in the forex market.
The US core CPI report could have a significant impact on the US dollar’s trading in the forex market, as it provides insight into the overall health of the economy and the potential for changes in monetary policy. Forex traders and investors closely monitor these reports and adjust their trading strategies accordingly.
The agency responsible for issuing the US Core Consumer Price Index (CPI)
The US Consumer Price Index (CPI) is released by the US Bureau of Labor Statistics (BLS), an agency within the US Department of Labor. The BLS is responsible for collecting, analyzing, and publishing a wide range of economic data, including measures of inflation such as the Consumer Price Index.
The BLS collects data on the prices of a basket of goods and services purchased by urban consumers across the United States. This data is used to calculate the consumer price index, which is released on a monthly basis. In addition to the core CPI, which excludes food and energy prices, the BLS also publishes a number of other CPI measures.
The BLS plays an important role in providing the data and analysis that policymakers, economists, and other stakeholders use to understand and manage economic trends in the United States.
When is the US Core Consumer Price Index (CPI) released?
The US Bureau of Labor Statistics (BLS) releases the US Core Consumer Price Index (CPI) on a monthly basis, usually on the 10th or 11th of the month following the reporting period.
For example, usually m The CPI data for January is released in mid-February. The exact release date can vary slightly depending on holidays and other factors, but BLS generally publishes a schedule of upcoming releases in advance.
Next release
Feb 13, 2024
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