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Lagging Economic Indicators
Definition
Indicators that correlate with past economic activity. They are indicators that tend to reach peaks and troughs after the aggregate economy.
Using the term Lagging Economic Indicators :
By definition, lagging indicators lag the action that has already occurred. So their primary use is to help develop a view of the business cycle and where we presently stand within it. Unemployment and whether it is rising or falling is one particularly helpful lagging economic indicator. If it is falling, that means business may be expecting better things ahead. If it is still trending higher, than business expects tougher times ahead.
Pay Special Attention To :
Lagging indicator are of minor use to precision trading and calling bottoms and tops in markets. They will help develop a general idea of where things are headed, but they should not be relied on for precision.
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Related terms
Economic Indicators
