Central bank is a national bank that provides financial and banking services for its country’s government and commercial banking system.
What is the role and function of Central Bank?
To set official bank rates used to manage inflation and exchange rates
To issue a country’s currency
To set targets and monitor economic data while they implement special tools.
One of the special tools that is used by the central bank is Interest/bank rates adjustments. When the Central Bank sees a need to hike or cut their rates, they simply do so.
Why do Central Banks hike the Interest Rates?
When the economy is growing at a rate that may lead to hyperinflation (monetary inflation occurring at a very high rate)
Why do Central Banks cut the Interest Rates?
The Central bank may cut the Interest Rates to encourage people to borrow more money at a lower rate, be it for new houses or businesses. The aim is to also make saving money less attractive as the returns are lower when the rates are cut.
About Bank Of Canada
Bank of Canada’s Interest Rates is released 8 times per year. On the 22nd of January they’ll hold their first meeting of 2020 to decide on their Interest Rates which is currently 1.75%. Below is the Bank of Canada’s 2020 dates.
Bank Of Japan’s Interest Rates is released 8 times per year. Their current rate is -0.10% and it has been for such a long time. On the 21st of January, they will hold their first meeting of 2020 to decide on their Interest Rates. Below is the Bank of Japan 2020 Interest Rates dates.
Welcome back. As promised in the beginning of the year that I will publish the annual dates of the most watched economic news, here’s another most watched economic event in the markets. Consumer Price Index accounts for the majority of overall inflation and inflation is very important to currency evaluation. Below is the U.K Consumer Price Index annual dates.
CPI stands for Consumer Price Index. It is the most watched economic indicator. It is calculated/released by the Bureau of Labor Statistics, which is part of the Department of Labor.
What does CPI measure?
It measures the change in price of goods and services purchased by the consumers excluding investment items such as stocks, bonds, real estates and life insurance. In short, CPI measures the cost of living. The CPI is released monthly.
Why do we (traders) care?
Consumer Price Index accounts for the majority of overall inflation. Inflation is important to currency evaluation. As promised in the beginning of the year that I will publish the most watched economic news annual dates. I’ve already published Non Farm Payrolls annual dates. To get started with your yearly plan, check this post here.
Below is the United States Consumer Price Index 2020 schedule. Thank you for stopping by and reading this post. Please share with your friends and stay tuned for more.
Non Farm Payrolls (NFP) is the most watched economic event in the markets. Non-Farm Payrolls is usually released on the first Friday of the month, 12 months a year and it is all about the number of jobs created during the previous month as compared to the current month. The stats exclude the farming industry hence it’s called the Non-Farm Payrolls.
Why Do Traders Care?
Job creation is an important indicator of consumer spending. It accounts for the majority of overall economic activity. When Non-Farm Payrolls stats are greater than expected, that is viewed as good for currency (USD) and an indication that the economy is doing well. When the stats are below expected, that is viewed as bad for currency(USD) and an indication that the economy is not doing so well.
Trading the news is not just straight forward whereby we buy when the results are above and sell when they are below. There are some other factors to consider. If you need to learn more about news trading, feel free to contact me. I have a course designed for someone who would like to learn.
Thank you for stopping by. As part of helping you with planning, I will publish the annual schedules of the most watched economic news, kindly subscribe so that you may not miss any of those publications. In case you missed my first blog post of 2020 about how to plan for your trading year, you can read it here. Below is the Non-Farm Payrolls annual schedule. Kindly share this post with your peers and subscribe . Cheers, till next time…