Economic news includes announcements about global and domestic economic performance and trends. Examples include central bank policy, job numbers, GDP, and inflation data. These are the stories that have a significant impact on the lives of businesses and their customers and investors. These stories should be reported using all the tools of journalism, including sourcing and verification.
Unlike other kinds of news, business news focuses on expectations. People’s expectations about future performance are baked into the prices of assets such as stocks, bonds, and currencies. Thus, any event that surprises people – either positively or negatively – causes a change in asset prices. That’s why economic news is the most important kind of news to cover.
It’s also important to remember that the economic news you report isn’t always what it seems. For example, a big headline number such as gross domestic product (GDP) growth doesn’t usually show the size of the economy, just how much bigger it was than the previous quarter or year. This is why you should focus on the percentage change in the size of the economy rather than merely the raw number.
Basic economic thinking would lead you to expect some relationships between news and the prices of assets such as stock market indices, bond yields, and foreign exchange rates. For example, if a government report shows that the economy is growing more rapidly than expected, it is likely to prompt a rise in bond yields and a rise in the value of the dollar against other major currencies.