Indicators Flashcards
1
Q
Composite
A
o Composite = 2 or more variables (best as it is cyclical in nature), combines a wide range of indicators which are weighted and converted into the one line on the graph (ANZ Bank Index of Economic Activity)
2
Q
Lagging
A
where the economy has been (changes in GDP, income and wages, U/E rate, CPI (inflation), currency strength, interest rates, corporate profits)
3
Q
Leading
A
where the economy is heading (dwelling approvals, consumer confidence, business sentiment)
4
Q
Coincident
A
where the economy is at (real GDP, retail sales, motor vehicles, registration)
5
Q
What to look for when interpretation indicators
A
♣ Time series
♣ Trends
♣ Seasonal adjustments
♣ Erratic factors
