My Economy Guide addressed many of the fundamental concepts in economics and various issues related to markets. In this article directory, important concepts, definitions and explanations about the investment will be explained for you. Thus , you will have the knowledge needed by an investor and you will have the opportunity to invest correctly. Now let’s take a closer look at the economic indicators.
Economic indicators are very important for investors to make the right moves at the right moments. Most of these indicators are linked to inflation. The reason for this is the high impact of inflation on economic stability and interest rates.
GROSS DOMESTIC PRODUCT (GDP)
GDP is one of the most important economic indicators. It is possible to reach many conclusions and perform various analyzes on this indicator. Net exports, investment, consumption and government purchases are the four basic elements of GDP. This indicator is a delayed index which results in past tenses and takes a long time to calculate. The main conclusion is that the economy is contracting or expanding.
CONSUMER PRICES INDEX (TFE)
TFP, measured by countries’ statistical institutions, is directly linked to inflation. This index follows the increases or decreases in the prices of products in a certain market basket. Unlike other inflation measurement indices, imported goods are also included in this basket. The situation of inflation can be monitored with TFE.
CONSUMER TRUST INDEX
The consumer confidence index is established as a result of interviews with a large number of families. It reveals society’s desire for consumption and confidence in the economy. This index also checks the public whether the economy is healthy for the country. Especially in bad times, difficult conditions or crises, this index gains more value in terms of economy. Decreases in the consumer confidence index indicate that the society wants to avoid consumption, thus reducing the flow of money in the markets.
INCREASE IN PAID BUSINESS OPPORTUNITIES
The state employment report is one of the most important indices such as GDP. Reports on increases in paid employment include important statistics such as current unemployment and hourly earnings. The increase in paid employment opportunities is seen as a sign that the consumption desire of the society will increase and the confidence in the economy in the society will increase. As a result of these increases, the amount of money returned in the markets increases. Decrease in job opportunities and decrease in employment cause consumers to become more tense and save expenditures. This indicator is a strong and valuable indicator.
Unemployment index is a delayed index that occurs after the changes in the economy. Although this situation diminishes the importance of this index for investors, the long-term increase in the unemployment index may inform the bad days in the economy and the rise in inflation.
STARTING OF NEW HOUSING CONSTRUCTIONS
This economic indicator indicates the number of new housing units on a monthly basis. It does not make sense if the houses are in the form of detached or apartment buildings. At the same time, 30 houses in an apartment are counted as 30 residences. The increase in housing constructions indicates a positive atmosphere in the economy. The decrease in the number of new construction is an indicator that the economy and the markets are experiencing stagnation.
Business stocks are another economic indicator that is collected monthly and is important for investors. This indicator data is collected from manufacturers, retailers and wholesalers. Sudden decreases in stocks indicate increasing demand and activity in the market, while sudden accumulations indicate decreasing demand and stagnation. Thus, expansion or contraction in the economy can be observed.
PRODUCER PRICE INDEX
The producer price index tracks wholesale changes in the prices of goods and products. Data on raw materials, intermediate goods and finished goods ready for sale are collected in this index. This economic indicator, which emerges from information gathered from hundreds of thousands of products and from thousands of manufacturers, is at an important point in the CPI forecasts.