Editing Business cycle (section)

=== Indicators ===
{{main|Inverted yield curve}}
[[Economic indicators]] are used to measure the business cycle: [[consumer confidence index]], [[Retail trade|retail trade index]], [[unemployment]] and [[Gross domestic product|industry/service production index]]. [[James H. Stock|Stock]] and [[Mark Watson (economist)|Watson]] claim that financial indicators' predictive ability is not stable over different time periods because of [[economic shock]]s, random fluctuations and development in [[financial system]]s.<ref>Stock, J.H., & Watson, M.W. (1999). (pp. 3–14). "Business Cycle Fluctuations in US Macroeconomic Time Series", Amsterdam: Elsevier.</ref> [[Sydney C. Ludvigson|Ludvigson]] believes consumer confidence index is a [[coincident indicator]] as it relates to consumer's current situations.<ref>Ludvigson, S.C. (2004). (pp. 29–45). "Consumer Confidence and Consumer Spending. Journal of Economic Perspectives."</ref> [[Joseph Winston|Winton]] & Ralph state that retail trade index is a benchmark for the current economic level because its aggregate value counts up for two-thirds of the overall GDP and reflects the real state of the economy.<ref>Winton, J., & Ralph, J. (2011). (p. 88). "Measuring the accuracy of the Retail Sales Index. Economic and Labour Market Review".</ref> According to Stock and Watson, [[Unemployment compensation|unemployment claim]] can predict when the business cycle is entering a downward phase.<ref>Stock, J.H., & Watson, M.W. (2003a). (pp. 71–80). "How Did Leading Indicators Forecasts Perform During the 2001 Recession?. Economic Quarterly – Federal Reserve Bank of Richmond".</ref> [[European Central Bank|Banbura]] and [[European Central Bank|Rüstler]] argue that industry production's GDP information can be delayed as it measures real activity with real number, but it provides an accurate prediction of GDP.<ref>Banbura, A., & Rüstler, G. (2011). (pp. 333–342). "A Look Into the Factor Model Black Box: Publication Lags and the Role of Hard and Soft Data in Forecasting GDP. International Journal of Forecasting".</ref>

Series used to infer the underlying business cycle fall into three categories: [[Lagging indicator|lagging]], [[Coincident indicator|coincident]], and [[Leading indicator|leading]]. They are described as main elements of an analytic system to forecast peaks and troughs in the business cycle.<ref>The Conference Board (2021). https://conference-board.org/data/bci/index.cfm?id=2151.</ref>  For almost 30 years, these economic data series are considered as "the leading index" or "the leading indicators"-were compiled and published by the [[U.S. Department of Commerce]].

A prominent coincident, or real-time, business cycle indicator is the [[Aruoba-Diebold-Scotti Index]].