“Buy the rumor, sell on the news.”(Forecast vs.

Actual Number)

The difference from expectations drives the volatility, not the number itself.

By Sinan A: Based on Brent Donnely currently HSBC Bank senior FX trader Brent Donnely, with 20+ years of experience previously working for Citibank, Lehman Brothers(+ more) also been quoted by Economist & CNBC

To get a feel for the trend, it is a good idea to review the history of previous economic data releases. If the US economy looks like performing badly, traders may turn to safe havens: Gold & Silver.
FOMC(Federal Open Market Committee) Meeting: Hawkish Stance: Higher Interest Rate(LONG/BUY) - FIGHTS INFLATION - High Interest = High interest rates discourage consumer spending, but do bring in foreign investment.
Dovish Stance: Lower Interest Rate(SHORT/SELL) - FIGHTS DEFLATION - Low Interest = Low interest rates encourage consumer spending, but do not bring in foreign investment.
- You also have to factor in interest rate differentials between other countries. If the US interest rates are reduced, but still higher than other countries. The US dollar may not even budge.

INDICATORS IMPORTANCE RELEASED INDICATORS IMPORTANCE RELEASED

Nonfarm Payrolls(NFP) - Be ready for number! ⭐⭐⭐⭐⭐ 1st FRIDAY/Mo Building Permits ⭐⭐ ⭐⭐⭐⭐⭐
to MONTHLY
How many currently employed in the US, excl. farmwork. (few rare exceptions) Housing Starts
Google nonfarm payrolls preview in the days leading up to the release, and absorb everything you can. Pending Home Sales(PHSI)
- Headline Figure = Net-number of new jobs created(not rotations from other state jobs). +/- Bullish/Bearish. New Home Sales
- For example, -1000K means 100,000 jobs were lost in all NON-agricultural businesses. NAHB Housing Index
- Unemployment Rate = How many are unemployed. +/- Bearish/Bullish. Housing Starts: How many new single-family homes or buildings were constructed throughout the month.
- Average Hourly Earnings = HIGHER % rate of salary change is Bullish economy. Pending Home Sales: Estate Agents/Brokers, how many existing pending house sales.

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New Home Sales: % Sale of new houses being constructed.
Initial Jobless Claims - Focus on this instead of Continuous Claims . EVERY THUERDAY NAHB Housing Index: The survey is aimed to assess the current & future single-family housing market. +50/Bullish/-50/Bearish.

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New 1st time applications filled for unemployment benefits.
- A change of at least 30,000 claims up or down is considered significant +/- Bearish/Bullish. Retail Sales(MRTS) 1/2 MONTHLY
- Higher employment usually leads to higher interest rates. Good measurement of robustness of consumer spending, confidence and overall health of the economy.

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- Most Important figure is MoM ex auto & gas.
GDP(Gross Domestic Products) QUARTERLY*
Economic Growth %: Final goods and services sold on the market. Export minus Import= Growth. Chicago PMI, Philly Fed and Empire State ⭐⭐⭐ MONTHLY
Advanced/Preliminary/Final - Focus on ADVANCED(and only maybe preliminary) growth rate rapport. Regional business surveys similar to the ISM surveys.

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- Be aware/ready Chicago PMI is leaked 3 min before to subscribers, before going public.
Core PCE(Personal Consumption Expenditures) - DE/INFLATION INDICATOR SAME TIME AS GDP - Whatever move you see on Chicago PMI 9:42AM is not a random move! - Follow the move.

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Private household consumption excl. food & energy(less volatile than CPI).
- Target is 2%. Watch out if it nears or breaks 2%+. High numbers = Inflation sign. Low %? could be deflation. Industrial Production Index(IPI) MONTHLY
- If it is above 2% the Fed will raise interest rates, to prevent inflation. And way below 2% they lower interest rates. US output(material produced), compared to a base year, in 3 broad categories: mining, manufacturing and gas/electric utilities.

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Consumer Confidence Index(CCI)
A survey of 5,000 consumers asking them how they feel about the current economy, and future expectations.
- Consumer Spending. A neutral level is about 100, -75 is weak, +125 is strong.
- 2 or more consecutive quarters, where the confidence levels fall below 100 is seen as economic recession.
- Stocks(S&P500) & USD/JPY are usually moving bullish on strong numbers, and bearish on weak numbers.
- Number sub 100 means production is not optimal. +100/bullish/-100/bearish
LAST THUESDAY/Mo - For instance index 105.0 means production was 5% higher than the current base year(2012) average.
-Can act as a leading indicator of employment/income data.
Producer Price Index(PPI) - DE/INFLATION INDICATOR(long term forecasting) ??? EVERY 2nd WEEK
CPI equivalent(excl. export), but for producers instead of consumers. Raw material prices for manufacturing.

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- Higher production cost = Higher consumer prices(Can show early sign, before CPI verify it).
ISM Manufacturing & Service(PMI-Purchasing Managers Index) 1st/3rd BUSINESS DAY/Mo
Survey to 400 member companies/managers, representing 20 different industries. Capacity Utilisation ??? MONTHLY(mid)
- Focus On Headline ISM + New Orders, Production And Employment. US manufacturing capacity.
- +50(bullish) indicates industry expansion, -50(bearish) show contraction. - As a historic general rule, a rate sub 78% points into a coming recession, or maybe we already in one.

CPI(Consumer Price Index) - DE/INFLATION INDICATOR! ⭐⭐⭐ MONTHLY(mid)

Retail Price Index incl. export: ALL consumption, services(hospital, car insurance) incl. Food & energy.
- CPI should rise 1-2% max annually, 2%+ = indicates growing levels of Inflation.

University of Michigan Confidence(MCSI) ⭐⭐ MONTHLY

Index of Consumer Sentiment (ICS): 500 Random households surveyed with 50Q about the economy.
- Measures consumer optimism regarding the US economy. Good for early clue on NFP.

Durable Goods Orders(MoM, excluding transportation) ⭐⭐⭐ MONTHLY

Measures demand for U.S. manufactured durable goods, from both domestic and foreign sources.
- IGNORE headline number, focus only on MoM(month to month) number. +/- bullish/bearish.