How do you read an economic data release?

Wages beat inflation when nominal wage growth exceeds the inflation rate over the same period. Real wage growth is (1 + wage growth) ÷ (1 + inflation) − 1. Using BLS average hourly earnings and CPI for the same 12 months gives a simple answer; BLS also publishes an official Real Earnings release.

HICP is the euro area's harmonised consumer price index compiled by Eurostat; CPI is the U.S. index compiled by BLS. The biggest difference is housing: U.S. CPI includes owners' equivalent rent, while HICP leaves out owner-occupied housing costs, so the two rates are not directly comparable.

The European Central Bank sets three key rates: the deposit facility rate (paid on banks' overnight deposits), the main refinancing operations rate (for weekly loans) and the marginal lending facility rate (for overnight borrowing). With ample excess liquidity, the deposit facility rate is the one that steers euro money-market rates.

Read a CPI release in four passes: the 12-month all-items change (not seasonally adjusted), the one-month seasonally adjusted change, the same two numbers for core CPI, and then Table A’s component lines (shelter, energy, food, goods, services) to see what drove the month.

Read the Employment Situation report in this order: the nonfarm payroll change and its revisions to the prior two months, the unemployment rate, average hourly earnings, the average workweek, and labour-force participation. Together they show hiring pace, slack and wage pressure.

The Treasury yield curve plots yields on U.S. government debt from one month to 30 years. Normally longer maturities yield more. Analysts watch the 10-year minus 2-year and 10-year minus 3-month spreads; when they turn negative the curve is inverted, which has preceded past U.S. recessions with long, variable lags.

The Federal Open Market Committee sets a target range for the federal funds rate at eight scheduled meetings a year. Twelve members vote: seven Fed governors, the New York Fed president and four rotating Reserve Bank presidents. The decision is published in a statement at 2:00 p.m. Eastern Time.

The BLS calculates the CPI by pricing a fixed basket of consumer goods and services across U.S. urban areas each month, combining price changes within about 240 item categories and 75 areas, then weighting them by household spending shares.

Headline inflation measures price changes for the whole consumer basket. Core inflation excludes food and energy, whose prices swing with weather and oil markets, so it is used to judge the underlying trend. In the U.S. CPI, core is the all-items index less food and energy.

The unemployment rate comes from the household survey of about 60,000 homes, while payroll job gains come from the establishment survey of employers. They count different things: people with jobs versus jobs on payrolls, so self-employment, multiple jobholders and sampling error make them diverge.

Economic data are revised because first estimates are built from incomplete samples and later replaced with fuller information. U.S. payrolls are revised twice in the following months and benchmarked once a year to tax records; seasonally adjusted CPI is revised each February.