The definition of leading indicators (Leading Indicators)

Leading Indicators (Leading Indicators) is composed of a series of 12 related economic indicator groups, which are used to test the overall economic transformation and predict the most effective statistical indicators of the future economic trend, also known as leading indicators.

Announced date
The last business day of each month.

If the leading indicator declines for three consecutive months, it can be predicted that the economy is about to enter a recession: if it rises for three consecutive months, it means that the economy is about to prosper or continue to prosper.

The content of leading indicators can be divided into:

  1. The average number of hours per week of workers employed in manufacturing.
  2. The average number of people receiving unemployment benefits from the state government every week.
  3. The amount of orders for consumer goods and raw materials obtained by manufacturers based on the value of the dollar in 1972.
  4. The performance of the manufacturer in completing the order and delivering the goods to the order.
  5. The conversion rate of small businesses.
  6. Contracts for the construction of factories and investment in production equipment (based on the dollar value in 1972).
  7. Application for construction license.
  8. The manufacturer’s inventory changes.
  9. The price changes of sensitive commodities.
  10. Price changes in the stock market (based on the top 500 companies in the United States).
  11. Interest rate risk refers to the risk that when the market interest rate rises, the price of a financial instrument that was originally invested in a fixed interest rate may fall. Financial instruments to avoid interest rate risk include: floating interest rate certificates of deposit, futures, interest rate options, interest rate swaps, and interest rate ceilings.
    What are the commonly used economic leading indicators?

What are the commonly used economic leading indicators?

Commonly used economic leading indicators include: ISM Purchasing Managers Index (PMI), China Manufacturing Purchasing Managers Index and OECD Comprehensive Leading Indicators.