Economic News 2017.12.21

 

EXPLANATION OF THE ECONOMIC NEWS

 

  1. Gross Domestic Product (GDP) measures the annualized change in the inflation-adjusted value of all goods and services produced by the economy. It is the broadest measure of economic activity and the primary indicator of the economy’s health.
    Usual Effect:Actual > Forecast = Good for currency
    Frequency: Released monthly. There are 3 versions of GDP released a month apart – Advance, second release and Final. Both the advance the second release are tagged as preliminary in the economic calendar.

 

  1. The GDP Price Index measures the annualized change in the price of all goods and services included in gross domestic product.It is the broadest inflationary indicator. A higher than expected reading should be taken as positive/bullish for the USD, while a lower than expected reading should be taken as negative/bearish for the USD.

 

  1. Initial Jobless Claims measures the number of individuals who filed for unemployment insurance for the first time during the past week. This is the earliest U.S. economic data, but the market impact varies from week to week. A higher than expected reading should be taken as negative/bearish for the USD, while a lower than expected reading should be taken as positive/bullish for the USD.

 

  1. The Philadelphia Federal Reserve Manufacturing Index rates the relative level of general business conditions in Philadelphia. A level above zero on the index indicates improving conditions; below indicates worsening conditions. The data is compiled from a survey of about 250 manufacturers in the Philadelphia Federal Reserve district. A higher than expected reading should be taken as positive/bullish for the USD, while a lower than expected reading should be taken as negative/bearish for the USD.

 

  1. The Philly Fed Employment number is the employment component out of the Philly fed index, probably the most important component of the Index. A higher than expected number should be taken as positive to the USD, while a lower than expected number as negative.

 

  1. The Commodity Futures Trading Commission’s (CFTC) weekly Commitments of Traders (COT) report provides a breakdown of the net positions for “non-commercial” (speculative) traders in U.S. futures markets.
    All data corresponds to positions held by participants primarily based in Chicago and New York futures markets.
    The Commitments of Traders report is considered an indicator for analyzing market sentiment and many speculative traders use the data to help them decide whether or not to take a long or short position.
    Commitments of Traders (COT) data is released each Friday at 3:30pm Eastern Time, pending a holiday in the U.S., to reflect the commitments of traders on the prior Tuesday.