Composite Index Of Lagging Indicators

AAA

DEFINITION of 'Composite Index Of Lagging Indicators'

An index published monthly by the Conference Board that is used to confirm the direction of the economy's movements in past months. The index is made up of the following seven economic components, whose changes tend to come after changes in the overall economy:

1. The value of outstanding commercial and industrial loans
2. The change in the Consumer Price Index for services from the previous month
3. The change in labor cost per unit of labor output
4. The ratio of manufacturing and trade inventories to sales made
5. The ratio of consumer credit outstanding to personal income
6. The average prime rate charged by banks
7. The inverted average length of employment

INVESTOPEDIA EXPLAINS 'Composite Index Of Lagging Indicators'

As it measures the economic activities of previous months, the Composite Index of Lagging Indicators is used as an after-the-fact way to help confirm economists' assessments of current economic conditions. For this purpose, the Composite Index of Lagging Indicators is best used in conjunction with the Composite Index of Coincident Indicators and Composite Index of Leading Indicators.

RELATED TERMS
  1. Business Cycle

    The fluctuations in economic activity that an economy experiences ...
  2. Lagging Indicator

    1. A measurable economic factor that changes after the economy ...
  3. Business Cycle Indicators - BCI

    Composite of leading, lagging and coincident indexes created ...
  4. Consumer Price Index - CPI

    A measure that examines the weighted average of prices of a basket ...
  5. Central Bank

    The entity responsible for overseeing the monetary system for ...
  6. Consumer Confidence Index - CCI

    A survey by the Conference Board that measures how optimistic ...
Related Articles
  1. Investing

    What are leading, lagging and coincident indicators? What are they for?

    An indicator is anything that can be used to predict future financial or economic trends. For example, the social and economic statistics published by accredited sources such as U.S. government ...
  2. Retirement

    Economic Indicators To Know

    The economy has a large impact on the market. Learn how to interpret the most important reports.
  3. Markets

    A Guide To Conference Board Indicators

    Learn to put the CB data sets to trading use. Each chapter takes you through one of the board's benchmark indicators or surveys, their significance and their applications.
  4. Economics

    How Demographics Drive The Economy

    Demographics can have a profound effect on the economy. An aging population coupled with a declining birthrate points to a decline in economic growth.
  5. Economics

    The Economic and Social Effects of Corruption

    Corruption results in inefficiencies in the operations of emerging economies, and prevents such economies from reaching the maximum level of development.
  6. Economics

    Understanding the Multiplier Effect

    The multiplier effect is an economic term referring to how an increase in one economic activity can cause an increase throughout many other related economic activities.
  7. Investing

    What Is Hollywood Spending On Oscar Campaigns?

    Here's a look at how much Hollywood is spending this awards season to take home the gold at the 2015 Academy Awards.
  8. Economics

    Sanctions & Falling Oil Prices Hit Ruble Hard

    Russia, through its aggressive actions, has brought upon itself sanctions which, coupled with falling oil prices, have adversely impacted its economy.
  9. Economics

    Is the consumer price index (CPI) the best measure of inflation?

    Discover how the CPI is one of the most used indexes to measure inflation, but due to its limitations, the PPI and GDP deflator are also required.
  10. Economics

    What is the difference between the consumer price index (CPI) and the producer price index (PPI)

    Learn how the PPI and CPI differ in the composition of their target sets of goods and services and the types of prices collected for them.

You May Also Like

Hot Definitions
  1. Commercial Paper

    An unsecured, short-term debt instrument issued by a corporation, typically for the financing of accounts receivable, inventories ...
  2. Federal Funds Rate

    The interest rate at which a depository institution lends funds maintained at the Federal Reserve to another depository institution ...
  3. Fixed Asset

    A long-term tangible piece of property that a firm owns and uses in the production of its income and is not expected to be ...
  4. Break-Even Analysis

    An analysis to determine the point at which revenue received equals the costs associated with receiving the revenue. Break-even ...
  5. Key Performance Indicators - KPI

    A set of quantifiable measures that a company or industry uses to gauge or compare performance in terms of meeting their ...
  6. Bank Guarantee

    A guarantee from a lending institution ensuring that the liabilities of a debtor will be met. In other words, if the debtor ...
Trading Center