leading economic indicator

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Related to leading economic indicator: Index of Leading Indicators

Leading Economic Indicator

An indicator that occurs before an economy has started moving in a particular direction and is therefore used to predict the economy's movement. For example, a reduction in the average number of hours worked by manufacturing employees is considered a leading indicator because it usually precedes an economic slowdown or a recession. Among the indicators used by the Composite Index of Leading Indicators are the change in the money supply and the number of new building permits issued for residences. Leading economic indicators are used to help predict the direction of the economy; investors and businesses can use them to make their decisions accordingly.

leading economic indicator

An economic or a financial variable that tends to move ahead of and in the same direction as general economic activity. Compare lagging economic indicator. See also index of leading economic indicators.
References in periodicals archive ?
Based on a comparison of data compiled since the survey's inception in 1995 with figures from the Department of Commerce on Construction Put in Place, the findings amount to a leading economic indicator that provides an approximately nine to twelve month glimpse into the future of nonresidential construction activity.
Mexico's leading economic indicator is calculated monthly by The Conference Board (New York), the source for a January 20, 2006 report distributed by Reuters.
Japan's Leading economic indicator rose for the fourth straight month in July, with the index rising to 83.
As a component of the index of leading economic indicators, the rental vacancy rate is used by the federal government and economic forecasters to gauge the economic climate.
The Conference Board said its index of leading economic indicators (LEI)--designed to predict economic performance in the coming three to six months--rose 0.
Australia-based Westpac (NYSE: WBK) and the Melbourne Institute have said that an Australian index of leading economic indicators had advanced in June.
Japan's index of leading economic indicators, which shows how the economy is likely to perform in coming months, marked a record rise in May, evidence the world's third-largest economy is poised to recover strongly from the March earthquake and tsunami due to an upturn in production, government data showed Wednesday.
Economy: Leading Economic Indicators Rise for Sixth Straight Month</h1>

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