1.1.1.3 Important Lagging Indicators
Consumer Price Index (CPI). The CPI is a monthly report released by the Bureau of Labor and Statistics. It measures changes in the price of a “basket of goods” that a typical consumer might purchase, including food and energy products. The CPI is considered the best measure of inflation. The release of the CPI has a large effect on both the equity and debt markets because it gives a strong indication of whether the Federal Reserve will alter interest rates.
Other lagging indicators:
• Business spending
• Unemployment report
• Prime rate charged by banks
• Bank loans outstanding
• Employment Cost Index (ECI)—monthly changes in employee wages and benefits
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