Glossary · Macro · Beginner-friendly
Inflation
In plain English
Inflation means everyday prices rising, so each dollar buys a little less. Markets watch it because it affects interest rates and which stocks lead.
Everyday analogy: Your grocery cart costing more each year for the same items.
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Why it matters
Inflation reshapes rates, multiples, and which sectors lead. It is a markets story as much as a grocery story.
A bit more detail (optional)
Why markets care
Hot inflation often pushes rate expectations higher, which can compress valuations for long-duration growth stocks and support value or commodity narratives.
Surprise vs level
Markets trade the surprise versus consensus as much as the raw print. Revisions matter too.
Watch it on StockWatch
On CPI/PCE weeks, keep Upcoming catalysts visible, watch index heat on Markets, and compare rate-sensitive names versus defensives.
Simple examples
Hot CPI day
CPI prints above consensus. Rate-cut odds fall, growth multiples compress, and the dollar often firms.
Hot print day
CPI above consensus → rate-cut odds fall → long-duration growth often lags while energy or financials can catch a bid.
Easy mistakes to avoid
- Trading only the headline number and ignoring the surprise vs consensus
- Assuming all equities hate inflation equally
- Skipping revisions to prior prints
Remember: Inflation is a rates-and-multiples story - not just a consumer shopping story.