The Consumer Price Index (CPI) is the average norm of prices of a tight basket of products and services bought by users. Reports every month, which show the changes in CPI are usually followed as an inflation pointer.

The CPI is a primary inflation pointer because user expenditure accounts for nearly two-thirds of financial activity. Sometimes, the CPI is followed but did not consider the price of food and energy as these posts are much more changeable than the rest of the CPI and can shelter the more relevant underlying trend.

Heightening user price inflation is usually linked with the waiting of higher short term interest levels and may therefore be favorable for a currency in the short period. However, a longer period inflation problem will finally undermine confidence in the currency and there will be delicacy.

Importance: The CPI is important to monitor for its monthly stability except for food and energy prices. This activity helps to understand inflation trends better and is mostly known as the "core CPI". The higher inflation rate usually strengthens the dollar as far as the interest rates are supposed to grow. In case the inflation grows rapidly and there is a number of high values the situation lowers the trust and is harmful for dollar.

Source: Bureau of Labor statistics, U.S. Department of Labor

Availability: The data for previous month is available approximately on the 13th of each month at 8:30 a.m. EST.