leading indicator

A "leading indicator" helps predict future economic or business trends by showing changes before the broader economy or market responds.

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Definition

(technical)A measurable factor that changes before the economy starts to follow a particular pattern, used to predict future economic movements.

The rise in new housing starts is often viewed as a leading indicator of economic growth.
Investors monitor leading indicators to make informed decisions about the market.

(technical)A data point that signals future trends in business activity or market behavior.

The Purchasing Managers' Index (PMI) is a leading indicator that helps businesses forecast future demand.
Companies use leading indicators to plan their strategies and operations.

Terms that have similar or relatively close meanings to "leading indicator":