Business Cycle Indicators

What is the purpose of an economic indicator?

Indicators expose trends and help to forecast economic events in the future. They are considered when during decision making and planning.

What is a pro-cyclical indicator?

Relationship indicator that moves in the same direction of economic activity. Example: GDP is a pro-cyclical indicator because it is a determinant of economic activity.

What are some examples of a leading indicator?

• Stock market index • Building Approvals • Automotive orders • Applications for bank loans Confidence indexes Purchasing Managers Index (PMI)

What is the definition of a co-incident indicator?

A co-incident indicator is data from the last month. Co incident data moves in line with the level of economic activity.

What is the definition of a lagging indicator?

A lagging indicator is when information comes out well after the period it refers. Lagging indicators provide economic data that describes past levels of economic activity.

What is the Definition of an Economic Indicator

An economic indicator refers to data or information that help describe and measure the current state of the economy.

What is the definition of a leading indicator?

Leading indicators are economic information that predict trends in economic activity before the direction becomes evident elsewhere.

What is a counter-cyclical indicator?

Relationship indicator that moves in the opposite direction of economic activity. Example: Unemployment - as economic activity increases unemployment decreases

What are some examples of a lagging indicator?

• Economic Growth GDP • Inflation • Manufacturing Production Index • Import Indexes • Export Indexes • Current Account Deficit % of GDP

What are some examples of a co-incident indicator?

• Retail Sales Car sales • Building Commencements Unemployment