Keeping current inflation from being a three-year-old figure: release cycles and staleness of macro data

Jupick's macro screen includes indicators such as the US policy rate, government bond yields, consumer price inflation, the unemployment rate, a volatility index and exchange rates. These do not change every moment like stock quotes; each is released on its own fixed cycle.

Policy rates and government bond yields update almost daily, but consumer prices and unemployment come out once a month. So the inflation rate on screen today usually reflects last month's release, or the one before it.

Hiding this difference makes every indicator look as if it were measured at the same point in time. So Jupick shows, for each indicator, the reference date on which its value was observed.

The sources that supply macro data include series that have stopped updating. Some indicators remain stuck at values from years ago. For example, one Korean inflation series had been frozen since November 2023.

Using such a value just because it is the latest would make the screen present a number from years ago as if it were current. So Jupick removes from the screen any indicator whose last observation date is too old.

How old is too old depends on the indicator's cycle. A daily indicator that stops for more than three weeks, or a monthly indicator that stops for more than 100 days, is treated as no longer updating and is not shown.

If an interest rate that updates daily has stayed the same for three weeks, the data has clearly stopped. If things were normal, a new value would have arrived within a few days.

Monthly inflation, on the other hand, can show the same value for a few weeks and still be normal. The next release simply has not come out yet. So monthly indicators get a wider window and are treated as stopped only after passing it.

Applying the same yardstick to indicators with different release cycles would either drop a normal monthly indicator as stopped or keep a stopped daily indicator as live. That is why the width of the window is matched to the cycle.

Inflation indicators have one trap. The raw data often arrives not as a rate of increase (%) but as an index representing the price level. The consumer price index, for example, arrives as a number like 332.8.

Printed on screen as is, that number is unreadable to people. The value 332.8 by itself does not tell whether prices are going up or down. So Jupick converts it into the percentage increase from the same month a year earlier.

The “3.2% inflation” heard in the news is exactly this year-over-year figure. Only after an index is converted into this form can the pace of price increases be read.

Calculating a year-over-year change requires comparing with the value from 12 months earlier. But there is a hidden trap here. Simply taking the value 12 entries back in the data is no assurance that it is from 12 months earlier.

If even one month is missing in between, 12 entries back becomes 13 or 14 months back. Labeling that as the same month a year earlier produces an inflation rate compared against the wrong month.

So Jupick first aligns the data onto a grid keyed to the first day of each month, which exposes any missing months, and then looks for the value 12 months earlier on that grid. The comparison is based on actual months, not on the number of values.

Jupick grades stocks but not macro indicators. Putting a grade like S or A on interest rates or inflation would amount to Jupick ruling on whether a level is good or bad, and that is not the service's job.

The macro screen holds only facts: current values and changes from the past. It does not say whether an indicator is headed up or down, or how it might affect markets.

Showing numbers honestly and up to date is one task; interpreting them is another. Jupick does only the first.

What this article has covered is how macro data is kept current and readable for people. Where those indicators go from here is not covered.

High inflation or interest rates are not necessarily bad, and low ones are not necessarily good. The values are material for understanding a situation, not a verdict of better or worse.

This content is for information only and is not investment advice. Jupick does not forecast the future and gives no trading advice of any kind. Investment decisions and responsibility for them rest with the user.