Financial terms, explained from first principles.

Canada's central bank. Sets overnight target rate at 8 meetings per year. Commodity-cycle sensitive (oil exporter); traditionally moves alongside Fed.

UK central bank. Sets Bank Rate at Monetary Policy Committee meetings. Single inflation-target mandate (2% CPI).

Japan's central bank. Spent 2016-2024 pinning long-end yields via YCC. Ended NIRP in March 2024, hiking for first time in decades.

Income earned from holding a position over time.

Borrowing in a low-yielding currency to invest in a higher-yielding one, pocketing the rate differential.

Monthly US consumer confidence survey from the Conference Board. Complement to Michigan sentiment with different methodology and weights.

The curvature of a bond's price-yield relationship.

Core excludes food and energy from CPI to remove volatile components. Core is the persistent-inflation signal; headline drives the news cycle.

Monthly US inflation report (headline and core). Released mid-month at 8:30am ET. After NFP, the most market-moving scheduled release.

Fixed exchange rate maintained by a central bank against a reference currency or basket.

Monthly orders for goods expected to last 3+ years. Volatile (aircraft orders dominate) but leading indicator for business investment.

Bond price sensitivity to interest rate changes.

Eurozone central bank. Single mandate: price stability (HICP inflation target ~2%). Sets deposit rate, main refi rate, marginal lending rate.

Two regional Fed manufacturing surveys (NY, Philadelphia). Released mid-month, providing early signal for ISM Manufacturing PMI.

The overnight rate at which U.S. banks lend reserves to each other.

US central bank. Dual mandate: maximum employment + price stability. Sets fed funds rate via FOMC. The single most important policy institution in global markets.

The Federal Open Market Committee - the Fed's rate-setting body.

Direct central bank or treasury action in the foreign exchange market to influence the currency's level.

Gross Domestic Product — total US economic output. Released quarterly in three estimates: Advance (1 month after quarter), Preliminary, Final.

Monthly US new-residential-construction report. Leading indicator for housing market and rate-sensitive economic activity.

The rate at which prices rise across an economy.

Monthly survey-based US manufacturing health indicator. >50 = expansion, <50 = contraction. Released first business day of each month.

Monthly US services-sector health indicator. Services ~70% of US economy. >50 = expansion. Released 3rd business day of each month.

Monthly US job-openings report. The Fed's favorite labor-tightness gauge. Quits rate especially informative — high quits = strong labor market.

Monthly US employment report. The most market-moving scheduled macro release — moves SPX 1-2% and DXY 0.5-1.5% on first hour.

China's central bank. Sets daily CNY fixings (managed-float regime), Loan Prime Rate (LPR), Reserve Requirement Ratio (RRR). Less transparent than DM central banks.

Personal Consumption Expenditures price index — the Fed's preferred inflation gauge. Released ~30 days after the corresponding month, typically the last Friday.

Monthly US producer-side inflation index. Often leads CPI by 1-2 months. Released day before CPI typically.

Australian central bank. Sets cash rate at monthly Board meetings (first Tuesday of each month). Highly commodity-cycle sensitive.

New Zealand central bank. Sets Official Cash Rate at quarterly Monetary Policy Statements + intermeeting reviews. First country to adopt formal inflation targeting (1989).

Monthly US retail-spending report. ~30% of GDP. Released ~2 weeks after the corresponding month at 8:30am ET.

Sweden's central bank. Sets policy rate (repo rate) at 5 meetings per year. Often a first-mover on cycle inflections; pioneered negative rates.

Bond returns earned as time passes and the bond rolls down a positively-sloped yield curve.

Swiss central bank. Famous for aggressive FX intervention (2011 EUR/CHF floor, 2015 abandonment). Currently runs negative rates and FX-balance-sheet policy.

Weekly US jobless-claims report. Initial = new filings; continuing = ongoing claims. The highest-frequency labor-market indicator.

Monthly US consumer sentiment survey. Two releases per month: preliminary (mid-month) and final (end-of-month). Highly watched by Fed for inflation-expectations gauge.

Borrowing in low-yielding yen to buy higher-yielding assets globally.

Plot of bond yields across maturities.