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Home » Forex Glossary » Gross Domestic Product (GDP) United States

Gross Domestic Product (GDP) United States

As one of the most valuable economic measurements in the economy, GDP (which is measured in real and nominal terms) determines the value of goods and services produced in the US. It is a significant measure that can influence and determine the US' economic performance once it is released to the general public. For example a high GDP often indicates a strong economy and strong market activity, thus usually making the dollar stronger. However if this is not the case, meaning that GDP performance is not as high as expected, it may create inflation and thus higher interest rates. Also as the GDP is released, the GDP price index is included which measures the price change of goods and services within the US GDP. The GDP price index signals inflation and can influence the Federal Reserve to increase interest rates if price index figures increase.