Type Of Economic Data
First of all, not all economic data is the same and move the markets in the same way. Let’s say data that is going to be released is CPI (consumer price index) which measures changes in the price level of a market basket of consumer goods and services purchased by households and PMI (Purchasing manager’s index) which focuses on business conditions in the manufacturing sector. CPI and PMI are among the most important data as it covers the whole country in terms of sectors of the economy. Hence, the release of CPI has the potential to move the market.
Types of economic data:
• National; Gross Domestic Product (GDP), Inflation rate, Interest rate, Unemployment Rate.
• International; Current Account balance, Import and Export, foreign reserve
• Sector; PMI (Purchasing Manager’s Index), industrial production, business confidence,
When it comes to economic data release don’t just look at the data being released but look for the complete report because it means nothing if you don’t understand the data in-depth.
Important note: you have to understand each data’s true impact on the market, some are imminent and others are not don’t just look at the what is going to be released but go beyond it find out the significance behind it and why do the market participants pay attention to certain data compared to other data. This will make a big difference in you getting to understand and be able to take a position when you trade.