The fundamental side of the market


The index is published every month on the second working Fridays.

The usual interval fluctuations - from -0.5% to +0.5%.

Consumer Price Index - CPI (consumer price index) estimates the average change in retail prices of a fixed basket of consumer, except for changes in prices for new goods and services.

Include imported goods, services and taxes. It is assumed that the growth of this indicator reflects the rise in inflation and, therefore, cause a short-term weakening of the national currency. Most economists use the CPI as a measure of inflation and to predict price movements.

Growth of CPI, usually entails

- The fall of share prices on the stock market;

- Increase in rates in the credit market;

- Depreciation of the national currency in the foreign exchange market.

After publication May 14, 1999 the U.S. Consumer Price Index, which rose 0.7% in April compared with March, at a meeting of the monetary committee of the Federal Reserve, on 18 May, intensified fears of a tightening of monetary policy (raising interest rates). USDCHF 1.5010-1.4903 and EURUSD 1.0675-1.0743.

This index is published every month on the third working week (Tuesday or Thursday)

In England, called the RPI. Ranging from -0.5% to +0.5%.

Deflator GDP (GDP deflator) extrapolates the gross domestic product at constant prices. Its growth leads to higher interest rates.

The employment

Unemployment Rate (rate of unemployment among the working population, in%) is determined by a poll 375.000 60.000 families and businesses. This is one of the key macroeconomic indicators. Used as an indicator of possible inflationary pressures by raising wages. It is believed that the low unemployment wages rise faster than at high, especially if the expected inflation rate. Characterizes the level of maturity of the business cycle. A good indicator is the level of 5%, while in Germany the normal value - 10%.

Reduce the unemployment rate below 4.5-5% could increase federal loan interest rates, which, in turn, will lead to a decrease in stock prices and an increase in profitability of the credit market instruments. Published the first working Friday of each month.

Nonfarm Payrolls (number of employees, defined payroll, except for agricultural workers); Average Workweek (average workweek in hours); Average Hourly Earnings (Average hourly earnings in USD); Employment Cost Index (index of wages, %). These indicators are used as a decisive argument in determining the level of inflation, and hence the possibility of changing the loan interest rates. For example, September 2, 1999 there was a sharp fall in the dollar against the Swiss franc from 1.5350 to 1.4881, as published overpriced economic data for the second quarter productivity growth from 1.3% to 0.6% and labor costs from 3.8% to 4.5% of annual growth, which is an omen of inflation. But the next day, the U.S. unemployment figures for August weakened expectations of higher interest rates in the near future FED number of jobs has increased by 124 million versus 310 million in July, the unemployment rate fell from 4.3% to 4.2%, and the average hourly wage increased only 0.2%, which was lower than the expected 0.4% and lower than the previous month's 0.5%. With this partially recovered stocks and government bonds, the U.S., and with them, and the dollar.