ECRI Weekly Leading Index: sale a 124,2 con growth a 5,1% (1 Viewer)


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13 Novembre 2001
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A high-frequency leading index of U.S. economic growth is available very promptly. The Weekly Leading Index (WLI) directly addresses concerns about the freshness of data that forecasters have with existing leading indicators, including the well-known monthly Index of Leading Economic Indicators (LEI), originally developed by ECRI's founder, Geoffrey H. Moore, for the U.S. Commerce Department.

The WLI resolves these issues by being available promptly and frequently. Specifically, each Friday the WLI is updated with data through the previous week. This is extremely prompt and represents a significant leap forward in the monitoring of economic conditions. In contrast, the LEI is far less prompt. Geoffrey Moore, who developed the original LEI, also oversaw the development of the WLI, which represents the latest in a long series of advances made since the introduction of the original leading index in the 1960s. Key improvements include:

Frequency - the WLI is available every week, rather than monthly, allowing for closer monitoring of the U.S. economic cycle.

Promptness - the WLI is extremely prompt. Each Friday the WLI is updated through the previous Friday, i.e., there is only a one-week publication lag.

New composite index method - an improved method of composite index construction is used (Geoffrey Moore and Julius Shiskin developed the original LEI method). The result is a more clearly cyclical index with increased sensitivity at economic cycle turning points.

Revisions - only one component (money supply) out of seven is subject to significant revision.

Leads - the WLI also has a longer overall lead than the LEI. Given its prompt availability, it has an even longer effective lead at business cycle turning points, and would have historically signaled a typical recession about three months ahead of the LEI. In fact, the WLI has a longer effective lead than the LEI at 83% of business cycle peaks and 60% of business cycle troughs.

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