See Also:
Consumer Price Index
Stagflation
Balance of Payments
What are the Twin Deficits?
The Feds Beige BookEconomic Indicator DefinitionEconomic indicators are macroeconomic data that describe the condition of an economy. They can be used to determine whether an economy is prosperous and expanding or troubled and contracting.
For example, a high unemployment rate and a contracting
GDP are considered signs of a troubled economy, such as a recession. While high levels of consumer confidence and rising stock market indexes are considered signs of a prospering economy.
Economic indicators are used by economists, investors, and policy makers in order to discern the health of the economy and to try to forecast changes in the business cycle.
Types of Economic IndicatorsThere are three types of economic indicators: leading indicators, lagging indicators, and coincident indicators.
Leading indicators considered predictors of economic trends. Analysts use these data to try to forecast changes in the business cycle. Examples of leading indicators include stock prices, building permits, average weekly initial claims for unemployment insurance and an index of consumer expectations.
Coincident indicators fluctuate simultaneously with the business cycle and reflect the current condition of the economy. Examples of coincident indicators include industrial production data, nonagricultural payroll data, and manufacturing and trade sales data.
Lagging indicators appear after the completion of economic trends and changes in the
business cycle. They can be used to analyze the economy in retrospect or to confirm other economic data. Examples of lagging indicators include average duration of unemployment, average
prime rate charged by
banks, and change in labor cost per unit of output.
Economic Indicator SourcesThe most reliable and closely-watched economic indicators are those that are published by government or non-profit organizations, such as the Conference Board, the Federal Reserve System, the Bureau of Labor Statistics, and other organizations. These organizations issue economic data periodically.
Economic Data Online Economic indicator data can be found at the following websites:
Conference Board Index:
conference-board.org/economicsFederal Reserve System:
federalreserve.gov