Economic indicators and their meaning, part ІІ

economic indicators
Economic indicators

PPI (Producer Price Index)

This indicator traces the inflation at the production and import prices at a particular country. Changes in it precedes changes in the consumer price index. As with each indicator of inflation, an increase in production prices and those of import, has a positive influence the Swiss franc, because usually the higher inflation leads to an increase of the basic rate of the Swiss Central Bank. This indicator has moderate impact on the market.

Consumer Confidence

By this indicator it is attempted to measure the optimism of users. It is traditionally used for predicting the tendencies in the sphere of employment and the overall condition of the economy. The growth of the index values is a positive factor for the development of national economy and leads to an increase in the rate of the national currency. It has a limited impact on the market, because it cannot reflect the real state of the economy.

Current account

This indicator is the ratio between the amount of payments that come from abroad and the amount of payments that go abroad. If the incoming payments of the country exceed the payments to other countries and international organizations, then the balance of payments is active (positive balance), and when we have the opposite variant – it is a passive balance (negative balance). The surplus (or the reduction of the amount of the negative balance) is a favorable factor for the growth rate of the national currency. This indicator has a limited impact on the market.

Current account – with seasonal adjust

Seasonally adjusted data are introduced, because of the seasonal fluctuations. Such variations include climate change, weekends, holiday periods and seasonal work.


GDP is an important indicator that reflects the state of the national economy and represents all goods and services produced in a country. GDP can be described with the following form: GDP = C + I + S + EM, where C is consumption, I – investment, S – state spending, E – Export, M – Import. GDP growth leads to an increase in the rate of the national currency. It has significant impact on the market.

Retail Sales m / m

The indicator measures the percentage monthly change in the revenue of retail outlets and includes durable and non-durable goods. This is the first real indicator for consumer spending. Some disadvantages are that it do not include services, insurance, fees for legal services and etc. It has a significant impact on the market.

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