Bloomberg market concepts Questions with Approved Answers "New news" moves markets. Accordingly, the economic indicators that heralds "new news" are of the most value to traders and investors. --timeliness of release GDP statistics ar e typically released by the government a month or more after the period in question, by which point dozens of other indicators have been released. --
Because GDP statistics are released well after other economic indicators Nonfarm payrolls, CPI and PMI are published monthly. GDP is only published on a quarterly basis. --GDP Which economic indicator is most directly linked to unemployment? --nonfarm payrolls What is the main reason that investment banks create estimates of economic indicators? --to know wh en specific economic data points are a positive or negative surprise Which of the following is the biggest pitfall of economic indicators? 1. they do not take into account seasonality 2, they are not sufficiently timely to make investment decisions 3. they only serve as proxys for economic activity 4. they do not consistently presage turning points --they do not consistently presage turning points In 1994, the Mexican peso declined against the US dollar by 37% during the so -called Tequila Crisis. What exacerbating factor did Mexico's Tequila Crisis have in common with the Argentine crisis of 2002? --both countries had large dollar -denominated debts What are 3 examples of failed pegs? --1. British sterling against the Deutsch mark in 1992 2. Mexican peso against the US dollar in 1994 3. Argentine peso against the US dollar in 2002 What is an example of a failed peg? --Hong Kong dollar aginst the US dollar in 1997 Currency market mechanics summary: ---the US dollar equivilent of 5T of currencies are traded every day -1971 marked the dawn of the modern currency market -several contries peg their currencies to other currencies -locked exchange rates ar e not actually set in stone but are government aspirations
Because GDP statistics are released well after other economic indicators Nonfarm payrolls, CPI and PMI are published monthly. GDP is only published on a quarterly basis. --GDP Which economic indicator is most directly linked to unemployment? --nonfarm payrolls What is the main reason that investment banks create estimates of economic indicators? --to know wh en specific economic data points are a positive or negative surprise Which of the following is the biggest pitfall of economic indicators? 1. they do not take into account seasonality 2, they are not sufficiently timely to make investment decisions 3. they only serve as proxys for economic activity 4. they do not consistently presage turning points --they do not consistently presage turning points In 1994, the Mexican peso declined against the US dollar by 37% during the so -called Tequila Crisis. What exacerbating factor did Mexico's Tequila Crisis have in common with the Argentine crisis of 2002? --both countries had large dollar -denominated debts What are 3 examples of failed pegs? --1. British sterling against the Deutsch mark in 1992 2. Mexican peso against the US dollar in 1994 3. Argentine peso against the US dollar in 2002 What is an example of a failed peg? --Hong Kong dollar aginst the US dollar in 1997 Currency market mechanics summary: ---the US dollar equivilent of 5T of currencies are traded every day -1971 marked the dawn of the modern currency market -several contries peg their currencies to other currencies -locked exchange rates ar e not actually set in stone but are government aspirations
