If you have no idea
what CPI, PMI, or ECI mean, then you are like most beginning investors. Let me
explain these and a few others terms to enhance your knowledge of indicators
that affect your investments.Economic indicators are used by the Federal
Reserve to monitor inflation. When they reflect inflationary pressure, the Fed
will increase interest rates. Conversely, when they show signs of deflation, a
decrease of interest rates becomes imminent. Interest rates are important for
the economy because they influence the willingness of individuals and
businesses to borrow money and make investments. An increase of interest rates
will cause a downturn in the economy, while a decrease will fuel an expansion.
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