A clear, plain-language trading glossary.

The Bank of Canada's rate decisions are watched closely by traders in the Canadian dollar, particularly alongside oil prices, given how closely the Canadian economy and currency track energy markets.

The BOE's Monetary Policy Committee votes on interest rates and publishes minutes showing how each member voted, giving markets an unusually direct read on the internal balance of opinion.

The Consumer Price Index tracks the price of a representative basket of household purchases — from groceries and rent to fuel and healthcare — over time. Central banks watch the year-over-year change closely because sustained increases erode purchasing power and often trigger interest rate decisions. Markets typically react most to the “core” CPI reading, which strips out volatile food and energy prices to reveal the underlying trend.

Each candlestick's body shows the range between the opening and closing price, while its wicks show the full high-to-low range for that period. Sequences of candlesticks form recognizable patterns that traders use to read shifts in market sentiment.

Central banks set benchmark interest rates, manage money supply, and act as lender of last resort to the banking system. Their policy decisions and communications are among the biggest single drivers of currency, bond and equity index prices.

Because commodities are largely undifferentiated by producer, their prices are driven primarily by global supply and demand, along with factors like currency strength, geopolitical events and weather. They're commonly traded via CFDs without taking delivery of the physical asset.

A single large swing in vehicle sales or fuel prices can distort the headline Retail Sales number without reflecting any real change in how consumers are spending elsewhere. Core Retail Sales removes that noise, which is why many traders treat it as the more reliable of the two figures.

Cryptocurrency prices are driven by a mix of adoption trends, regulatory developments, broader risk sentiment and each network's specific mechanics, and tend to be considerably more volatile than traditional currencies or commodities. They can be traded via CFDs without holding the underlying digital asset directly.

While cheaper prices sound appealing, persistent deflation is treated by economists as more dangerous than moderate inflation: it can encourage consumers and businesses to delay spending in anticipation of even lower prices, which itself slows economic activity and can become self-reinforcing.

A dovish tone tends to weigh on a currency, since it signals a lower probability of future rate rises — or a higher chance of cuts — which reduces the yield advantage of holding that currency relative to others.

Because it sets policy for a bloc of many economies rather than a single country, the ECB's decisions must balance sometimes very different conditions across member states — a complexity that makes its statements and press conferences closely parsed.

Traders use an economic calendar to plan around periods of likely higher volatility — many deliberately reduce position size or widen stops ahead of a high-impact release, since prices can move sharply and unpredictably in the seconds after the number is published.

The FOMC sets the target range for the US federal funds rate and communicates its outlook through a policy statement, a press conference, and — at alternating meetings — fresh economic projections. Its decisions are among the most market-moving events in global finance.

Beyond monetary policy, the Federal Reserve System supervises and regulates banks, maintains financial stability, and provides banking services to depository institutions and the US government. The FOMC (see separate entry) is the specific committee within it that decides interest rate policy.

In CFD and forex trading, fundamental analysis usually means tracking economic data releases, central bank policy and geopolitical developments to judge where an asset's price should be heading over time — the macro backdrop technical analysis is then used to time an entry against.

GDP is calculated quarterly and reported both as an absolute figure and as a percentage growth rate versus the prior period. Because it aggregates so much economic activity, GDP tends to confirm trends that faster indicators (like employment or PMI data) already hinted at, rather than surprise markets outright — its release still matters because it can validate or undercut the narrative those earlier reports built.

A hawkish tone — even without an actual rate change — tends to support a currency, since it raises the probability that rates will rise or stay higher for longer, which increases the currency's yield appeal relative to others.

Inflation is usually expressed as a year-over-year percentage change, most often derived from CPI. Central banks typically target a specific inflation rate and adjust interest rates to keep actual inflation near that target — which is why every inflation release is read partly as a signal of what the central bank is likely to do next.

Central bank benchmark rates set the floor from which most other borrowing costs in an economy are priced. Because a currency's yield is one reason investors hold it, changes in a country's interest rate — or even changes in expectations about future changes — are among the most direct drivers of currency valuations.

Highly liquid markets — major currency pairs during active trading hours, for example — allow large trades to be filled quickly at prices close to the quoted one. Liquidity tends to thin out overnight or around holidays, when the same size trade can move the price more.

Because the initial policy statement is necessarily brief, the minutes are read for finer detail — how divided the committee was, what risks were debated — that can reshape expectations for the next decision even though the rate itself hasn't changed.

Monetary policy is generally described as either tightening (raising rates or reducing money supply to cool inflation) or easing (cutting rates or expanding money supply to support growth) — distinct from fiscal policy, which is government spending and taxation.

Published on the first Friday of most months by the US Bureau of Labor Statistics, NFP arrives alongside the unemployment rate and average earnings figures. Because employment feeds directly into consumer spending and, through wages, into inflation, an NFP surprise can move currency, index and commodity prices within seconds of release.

PMI is compiled by surveying purchasing managers on output, new orders, employment and prices, then combining the responses into a single diffusion index. Because it's published well before slower official data, PMI is one of the earliest and most closely watched signals of where an economy is heading.

PPI is often described as a leading indicator for CPI: cost pressures at the factory gate or in raw materials tend to filter through to retail prices over the following months. A rising PPI with a lagging CPI can signal that consumer inflation is still to come.

The RBA's board meets monthly (except January) to set the official cash rate, and its statements are watched closely by traders in the Australian dollar, particularly given the currency's sensitivity to commodity prices and Chinese economic data.

As one of the first central banks globally to adopt formal inflation targeting, the RBNZ's decisions are closely tracked by traders in the New Zealand dollar, often grouped with the Australian dollar as a proxy for regional, commodity-driven sentiment.

There's no single official trigger — different countries use different criteria — but the common thread is a sustained contraction across multiple parts of the economy at once. Recessions typically weigh on riskier assets while supporting safe-haven currencies and government bonds.

Because consumer spending is typically the largest single component of a modern economy's output, Retail Sales is one of the more timely windows into whether growth is holding up or slowing down. Markets usually watch the month-over-month change, and often the reading excluding volatile categories like autos or fuel.

Because many assets move together based on overall sentiment rather than their own individual news, traders use risk-on/risk-off as a quick label for what's driving markets on a given day — useful context for why an asset might be moving in a direction its own fundamentals don't obviously explain.

In CFD trading, Shariah compliance is most directly reflected in swap-free account structures, since the standard overnight swap is itself a form of interest. Genuine compliance goes beyond removing swap fees alone — it also means not compensating for that removal through wider spreads or other disguised charges elsewhere in the pricing.

Markets read a policy statement almost word-for-word against the previous one, since even small changes in wording are treated as a deliberate signal about the likely direction of future policy.

Technical analysis rests on the idea that price already reflects all available information, and that recognizable patterns in how price has moved before can help anticipate how it might move next. It's typically used alongside, not instead of, an awareness of the fundamental backdrop.

Identifying the prevailing trend is one of the foundations of technical analysis, since many strategies are built around trading in the direction of an established trend rather than against it.

Because it's released every week rather than monthly, this figure gives markets an early read on whether layoffs are accelerating or easing well before slower reports like NFP or the unemployment rate confirm the trend.

A falling unemployment rate generally signals a strengthening economy and tends to support a currency, while a rising rate raises the odds of looser monetary policy. The figure is usually read together with wage growth and labor participation rather than in isolation.

High volatility means larger and faster price swings — more opportunity, but also more risk — while low volatility means calmer, more gradual price action. Volatility tends to rise sharply around major data releases and central bank decisions.

A price move on high volume is generally read as more significant than the same move on low volume, which can suggest a thinner, less convincing shift that's more likely to reverse.

WPI is the standard producer-side inflation gauge in economies such as India, where it sits alongside (or instead of) a PPI release. It captures price movements before goods reach retail, making it useful for spotting inflationary or deflationary pressure building in the supply chain.

In currency markets, a country's benchmark interest rate functions as a proxy for its yield: all else equal, a higher-yielding currency tends to attract more capital than a lower-yielding one.

Because it captures forward-looking sentiment rather than a backward-looking measurement, ZEW is watched as an early signal of where analysts think the economy is heading — useful context for the harder economic data that follows weeks or months later.