Leading Economic Indicator Law and Legal Definition

Leading economic indicator means an economic indicator that tends to indicate the future direction of the economy. A leading economic indicator usually changes before the economy as a whole changes. Some of the examples of leading economic indicator are stock market returns, index of consumer expectations, building permits, and the money supply. With respect to the stock market return indicator, the stock market usually begins to descent before the economy as a whole declines and usually begins to improve before the general economy begins to recover from a slump. It is also called as leading indicator.