- The Number Story
- What is Adjusted Data
What is Adjusted Data
"Adjusted data is economic information that has been modified to remove the influence of seasonal variations and other factors that can distort the true underlying trends in economic activity. Various economic reports use adjusted data and economic indicators to provide a more accurate representation of economic conditions by eliminating the effects of factors like weather, holidays, school schedules, and differences in the number of days in a month."
Here are some examples of economic reports that commonly use adjusted data:
Employment Reports: Reports like the Non-Farm Payrolls and Initial Jobless Claims often include seasonally adjusted figures to account for variations in employment levels caused by factors such as seasonal hiring patterns.
Retail Sales Data: Retail sales figures are frequently adjusted for seasonality, as the shopping patterns of consumers can vary significantly throughout the year due to holidays and changing weather conditions.
Gross Domestic Product (GDP): GDP figures are adjusted for inflation (real GDP) to provide a more accurate measure of economic growth, eliminating the impact of rising prices.
Housing Market Data: Data related to the housing market, including housing starts and home prices, often undergoes seasonal adjustments to account for variations caused by factors like the weather and construction seasons.
Industrial Production Reports: Industrial production data is adjusted to remove the effects of seasonal variations, ensuring that the data reflects changes in production levels more accurately.
Trade Balance Data: Data on imports and exports may be seasonally adjusted to provide a clearer picture of trade trends by removing fluctuations related to the timing of imports and exports.
Consumer Price Index (CPI): The CPI may be seasonally adjusted to provide a more accurate measure of inflation trends by eliminating the impact of seasonal price changes.
In summary, adjusted data is used in various economic reports to strip away seasonal and other short-term fluctuations, allowing for a better understanding of the underlying economic trends and making it easier for policymakers, businesses, and investors to make informed decisions.