Consumer Price Index (CPI)
While tomorrow’s report will draw some attention in the markets, due partly to a lack of governmental data over the past few weeks, it is Friday’s release of the Consumer Price Index (CPI) that traders are anxiously waiting for. It measures inflationary pressures at the consumer level of the economy and is considered to be one of the most important monthly reports for the bond market. It does come from a governmental agency, but some furloughed workers have been called back to complete this report because it is needed to determine the Cost of Living Adjustment (COLA) for social security recipients. Furthermore, the Fed will be able to use the data at their upcoming FOMC meeting later this month. Any surprises in the release should cause a strong reaction in the financial and mortgage markets.