leading indicator
Definition
An economic indicator that changes before the economy has changed. Examples of leading indicators include production workweek, building permits, unemployment insurance claims, money supply, inventory changes, and stock prices. The Fed watches many of these indicators as it decides what to do about interest rates. There are also coincident indicators, which change about the same time as the overall economy, and lagging indicators, which change after the overall economy, but these are of minimal use as predictive tools.
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Related Terms
coincident indicator, lagging indicator
'leading indicator
' appears in the definitions of these terms on BusinessDictionary.com
product price index (PPI), economic indicators, measure
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