PCE versus CPI: what's the difference in practice?
The Fed targets PCE inflation, but the market trades CPI because it lands first. The two differ in weights and scope, and the gap between them sometimes tells its own story (PCE report).
How do you use both?
- which measure you weight for the Fed's path
- how you read the gap between them
- the release you prioritise on the calendar
Background: CPI explained.
Background: CPI explained: headline and core inflation for forex traders
The consumer price index is the inflation figure markets watch most closely. What it measures, why core CPI matters and how it links to interest rates.
What is the difference between headline and core CPI?
Headline CPI includes all items in the basket. Core CPI excludes food and energy, whose prices are volatile, to show the underlying trend in inflation.
What time is US CPI released?
At 8:30 a.m. New York time, usually around the middle of the month, by the Bureau of Labor Statistics.
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