Macroeconomic indicators are a key part of fundamental analysis for traders, as they provide insight into the state of a country’s economy. These statistics allow analysis of economic performance and predictions of future performance and they vary in frequency, impact, and meaning. So, this mean that these indicators are important to any trader because they can have a significant influence on market movements
There a lot of macroeconomic indicators, but they have not the same importance so, it has no sense to waste the time and watch every possible indicator. In this post we are going to introduce some of the most used macroeconomic indicators. Let’s see now 10 macroeconomic indicators that every trader must watch:
- Global PMI. IHS Markit and JPMorgan Chase’s snapshot of the health of manufacturing around the world, based on surveys of multiple purchasing managers on their activity. A number above 50 signals expansion.
- U.S. employment. It is a measure of how tight the labor market is running in the world’s biggest economy.
- U.S. consumer spending. It is typically one of the pillars of the world economy and this shows how they are faring.
- U.S. personal consumption expenditures. it is the Federal Reserve’s preferred measure of inflation.
- U.S. NonFarm Payrolls. It measures the number of jobs added or lost in the US economy over the last month.
- Harmonised Index of Consumer Price (HICP). It measures the Euro area annual inflation and is the main measure watched by the European Central Bank.
- German IFO. It is the leading indicator of health in the euro area’s lynchpin economy, it is based on a sur-very of about 7,000 executives in German manufacturing, services, retail, wholesale and construction companies. The aim is to gauge their assessment of how the economy stands and their outlook for it.
- China manufacturing PMI. China is the largest manufacturer of autos, smartphones and other goods the world over so this index provides a key insight into the heart of global production.
- China PPI. How much companies are charging at the factory gate in China provides a glimpse into global inflation trends.
- Japan inflation. It is a measure of price pressures and test of how long the world’s most audacious monetary experiment continues.
These are not the only important macroeconomics that every trader needs to watch, because there are many others to watch. The choice of indicators to follow depends on the information that the trader needs.