Coincident economic indicator refers to economic indicators that change at the same time as economic activity. Or in other words, its turning points are close to those of the overall economy.
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Economists use it to measure the current state of the economy, rather than to confirm or predict future economic activity. It gives consumers, entrepreneurs, and policymakers an idea of where the economy is at present. When the economy grows today, it is also increasing now. And when economic activity declines today, it also coincides with dropping now.
As released by The Conference Board, examples of coincident indicators in the United States are:
- Employees on nonagricultural payrolls
- Personal income less transfer payments
- Industrial production
- Manufacturing and trade sales
The Federal Reserve Bank of Philadelphia also releases a monthly coincident index, which consists of:
- Employees on nonagricultural payrolls
- Average hours worked in the manufacturing sector
- Unemployment rate
- CPI-adjusted wage and salary disbursements