What the Indicator Shows
The Business Conditions Index is made up of three types of index: the "leading index," which moves ahead of the economy; the "coincident index," which moves roughly in step with the economy; and the "lagging index," which moves after the economy. Each is calculated by combining multiple economic statistics and is used as material for grasping the current state of the economy and its turning points.
How to Read It, and What to Watch Out For
The Business Conditions Index is a fact-based indicator that aggregates economic activity from the past up to the present — it does not predict or guarantee future economic conditions or stock price movement. It is used as one of several materials for comprehensively grasping the state of the economy alongside other economic statistics.