Check the definition

CPI tracks prices for a consumer basket. Use the publisher's definition of headline and core measures; US core CPI commonly excludes food and energy. Index levels and rates of change are different quantities.

Keep comparisons consistent

Monthly and annual changes answer different questions, and seasonal adjustment affects comparability. Record the comparison period, adjustment status and previous value. Do not join unlike measures into one apparent trend.

Separate data from interpretation

A surprise may alter policy expectations while other information also influences exchange rates. Preserve the result, expectation source and subsequent interpretation separately. Historical forecasts are not current trading instructions.

Distinguish household experience

A household's spending pattern may differ from the statistical basket, so its experienced price change need not equal published CPI. Compare coverage and weights before concluding that either the personal observation or the aggregate statistic must be wrong.

Source and reading notes

This is an independently written educational overview based on the ATFX reading linked below. Examples are illustrative, not live quotes or forecasts. It does not reproduce the original article or imply endorsement by its author.