Key economic indicators
US CPI and PPI
3 min
Just as the IPCA rules Brazilian markets, the US CPI rules global ones. For an internationally aware investor, US inflation data is unmissable.
CPI — Consumer Price Index
The CPI measures the change in prices paid by US consumers for a basket of goods and services. It is released monthly and is the most-watched US inflation gauge for markets.
- A hot CPI (above expectations) signals persistent inflation → the Fed is likely to keep rates high → the dollar strengthens, bond yields jump, and global stocks often sell off in the minutes after release.
- A cool CPI signals inflation is easing → markets anticipate rate cuts → a relief rally is common.
Investors pay special attention to core CPI, which excludes volatile food and energy prices to reveal the underlying trend the Fed truly targets.
PPI — Producer Price Index
The PPI measures prices at the wholesale / producer level — what businesses charge each other, before goods reach the consumer. It is watched as a leading indicator: rising producer costs often feed into consumer prices a month or two later. A surprising PPI can move markets in its own right and shape expectations for the next CPI.
The Brazilian parallel and the global link
The structure mirrors Brazil exactly: CPI is the US cousin of the IPCA (consumer-level), and PPI rhymes with the wholesale IPA / IGP-M family. The key practical point for a Brazilian investor: a hot US CPI strengthens the dollar, which tends to weaken the real and import inflation into Brazil, potentially nudging the BCB to keep the SELIC higher. US inflation is, indirectly, a Brazilian variable.
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