CPI Excluding Food and Energy - United States

The CPI is also reported excluding food and energy; two of its most volatile components. These components are particularly sensitive to temporary economic factors like oil prices, natural disasters and seasonal affects. Consequently, CPI excluding Food and Energy provides a more stable figure, but at the cost of overlooking two significant sectors in the economy (together food and energy comprise nearly a quarter of the goods included in the CPI).

The figure is the monthly percent change in the index.

CPI assesses changes in the cost of living by measuring changes consumer pay for a set of items. CPI serves as the headline figure for inflation. Simply put, inflation reflects a decline in the purchasing power of the dollar, where each dollar buys fewer goods and services. In terms of measuring inflation, CPI is the most obvious way to quantify changes in purchasing power. The report tracks changes in the price of a basket of goods and services that a typical American household might purchase. An increase in the Consumer Price Index indicates that it takes more dollars to purchase the same set basket of basic consumer items.

Inflation is generally bad news for the economy, causing instability, uncertainty and hardship. To address inflation, the Fed may raise interest rates. However, the Fed relies on the PCE Deflator as its primary gauge of inflation because the CPI does not account for the ability of consumer to substitute out of CPI's set. Price changes tend to cause consumers to switch from buying one good to a less expensive-other, a tendency that the fixed-basket CPI figure does not yet account for. Given that the PCE Deflator is a more comprehensive calculation, based on changes in consumption; it is the figure the Fed prefers.

The figure is released monthly, as either a month over month annualized percentage change, or percentage change for the full year. The figure is seasonally adjusted to account seasonal consumption patterns.

On A Technical Note: The CPI includes over 200 categories of goods and services included, divided into 8 main groups, each with a different weight: Housing, Transportation, Food, Medical Care, Education and Communication, Recreation, Apparel, and Other Goods and Services.

  The Current Account summarizes the flow of goods, services, income and transfer payments into and out of the country. The report acts as a line-item record of how the domestic economy interacts with rest of the world. The Current Account is one of the three components that make up a country's Balance of Payments (Financial Account, Capital Account and Current Account), the detailed accounting of all international interactions. Where the other side of the Balance of Payments, Capital and Financial Accounts deal mainly with financial assets and investments, the Current Account gives a detailed breakdown of how the country intermingles with rest of the global economy on a non-investment basis - tracking good and services.

Tracks the number of the employed in the country. A surge in new employment suggests higher spending potential and budding inflation pressures.

An indicator for broad overall growth in the Eurozone. Robust GDP growth signals a heightened level of economic activity, and therefore a high demand for currency. Economic expansion also raises concerns about inflationary pressure, which generally prompts monetary authorities to increase interest rates. This means that positive GDP readings are generally bullish for a given currency, while negative readings are bearish.

Due to the untimeliness of this report and because data on GDP components are available beforehand, the actual GDP figure is usually well anticipated. But given its overall significance GDP has the tendency to move the market upon release, acting to confirm or upset economic expectations. Robust GDP growth signals a heightened level of activity that is generally associated with a healthy economy. However economic expansion also raises concerns about inflationary pressures which may lead to monetary policy tightening.

The headline figure for GDP is an annualized percentage growth rate.

Technically, Gross Domestic Product is calculated in the following way:

GDP = C + I + G + (EX - IM)
where
C = private consumption
I = private investment
G = government expenditure
EX = exports of goods and services
IM = imports of goods and services

Technical note : GDP is the total market value of goods and services produced in the Eurozone within a given period after deducting the cost of goods and services used up in the process of production. Therefore, GDP excludes intermediate goods and services and considers final aggregates only.

The volume of loans granted in yuan during a month. The indicator's growth means stronger activity. The sharp increase of the indicator may triger tighter monetary policy.

Assesses changes in the cost of living by measuring changes in the prices of consumer items. The CPI is the headline inflation figure that indicates the strength of domestic inflationary pressures.

It is the key gauge for inflation in Switzerland. Simply put, inflation reflects a decline in the purchasing power of the Franc, where each Franc buys fewer goods and services. The CPI calculates the change in the price of a predetermined basket of consumer goods and services. This basket represents the goods and services that an average household will purchase. The figure is compared to those of the previous month as well as the previous year in order to gauge changes to the costs of living on a month to month and year to year basis. The headline number is the percentage change either from the previous month's value or the previous year's value.

As the key indicator of inflation, a rising CPI may prompt the Swiss National Bank to raise interest rates in attempt to manage inflation and slow economic growth. Higher interest rates make holding the Franc more attractive to foreign investors, and this higher level of demand will place upward pressure on the value of the Franc.

Measures changes in the prices paid by retailers for finished goods. Growth in wholesale prices usually precedes increases in retail prices, thus changes in Wholesale Prices can be used as an early indicator for inflation. While the CPI records price changes for retail goods, the WPI might pick up inflationary pressures before they reach the headline retail CPI report. The headline number is the percentage change in the index.

Note: WPI provides seasonally adjusted price changes to account for goods' seasonally volatility.