Inflation is more than one number
CPI is widely followed, but markets also watch core inflation, producer prices, wage growth and personal-consumption inflation measures. The trend and composition can matter as much as the headline figure.
Actual versus forecast
Markets often react to the difference between the released number and expectations. A high inflation print may create little reaction if it was already expected, while a smaller surprise can matter when positioning is one-sided.
Cross-market map
BondsInflation can shift expected policy rates and real yields.
USDRate expectations can support or weaken the dollar depending on the surprise and relative policy outlook.
GoldGold responds to the interaction of inflation expectations, real yields, USD direction and risk sentiment.
StocksInflation can affect margins, discount rates and sector leadership.
Before trading a release
- Know the forecast and previous reading.
- Check headline and core measures.
- Watch revisions and category detail.
- Expect spreads and volatility to expand around the release.