Predictive Core CPI Dataset Description

Core CPI, or Core Consumer Price Index, is a measure of inflation that excludes certain items that face volatile price movements, specifically food, and energy.

Prediction of Core CPI approximately 3 weeks before its actual release using machine learning and an array of alternative datasets. The dataset contains predictions and actuals for Core CPI and the two most commonly reported metrics. These metrics are the year-over-year percent change in Core CPI, as well as the month-to-month change in the year-over-year number. The dataset can be used both as a macroeconomic snapshot for longer-term strategies or as an indicator in shorter-term strategies centered around the release date of the actual CPI numbers (this date varies from month to month but is normally between the 10th and 15th).

Data Specification

The predictive Core CPI dataset consists of several fields. These include an internal sequence number, timestamps, trading symbols, and various figures related to Core CPI. The dataset contains both the machine-learning-based predictions, and the actual Core CPI, the year-over-year change in Core CPI, in addition to the month-to-month changes. The dataset's contents cover a significant span of time, starting from the 42036 timestamp onwards, with updates being added on a monthly basis.

Dataset Utilization

A portfolio manager might harness this dataset in various ways. One application could be as a broader economic snapshot for shaping longer-term investment strategies. By marrying investment trends with CPI predictions, a portfolio manager could potentially better anticipate which sectors may see growth or decline.

For example, if Core CPI is predicted to rise, this may indicate increasing inflation, which the manager could consider when investing in bonds or equities, as increasing inflation can often erode the real value of fixed-interest payments. Alternatively, lower predicted Core CPI may suggest an economic downturn, thereby signalling the manager to take a more defensive investment position.

Near-Term Trading Instruments

Predictive Core CPI dataset can also serve as a robust tool for shorter-term strategies built around the release date of CPI numbers. The CPI data is regularly released between the 10th and the 15th of every month. Given the advanced prediction offered by this dataset, portfolio managers can potentially reposition their portfolios to align with the upcoming inflation data, possibly gaining an edge over the market.

This might mean taking positions in inflation-sensitive assets (like commodities or inflation-protected securities) if the predicted CPI is high, or maybe moving towards cash or deflation-protected assets if the predicted CPI is low.

Caveats

Portfolio managers should note that although this dataset is not directly available for online purchasing, it can be purchased through the CloudQuant's sales department. Despite the fact that predictive indicators can be highly informative and potentially provide a trading edge, managers should be aware that they are based on machine learning techniques. Consequently, as with all such technology, there are risks of incorrect predictions. As such, the Predictive Core CPI Dataset should be used in tandem with other valuation and financial analysis tools for best results.