Economic Data Analysis

Flashcards covering key criteria for assessing the importance of economic data points.

LYND Acronym

A cheesy acronym to analyze where the economic data points are worth trading.

Macro Fundamental / Cyclical Considerations (M)

The macro context matters for how important the markets will deem an incoming economic data point, especially in relation to the central bank's policy cycle.

Impact Rating (I)

Refers to the different tiers of economic data points and their associated impact ratings.

Noise (N)

Some economic indicators can be prone to a lot of short term noise, whether it's due to seasonal data differences or the way the report is compiled. US retail sales and January jobs reports are examples.

Type and Timeliness (T)

The importance of an indicator's release could be impacted by its type (leading, coincident, or lagging) and its timeliness. Leading indicators carry weight at the end/start of an economic cycle. US GDP is a lagged economic release.

Leading Indicators

Carry a lot of weight at the end and the start of an economic cycle because markets will use them to track possible turns in the cycle.

US GDP

A tier two event, but it's a lag indicator and old news by the time that we get it.