Lagging indicator

A lagging indicator is a data point that only changes after a significant shift in the economy has begun. A lagging indicator is used to confirm a trend that is already underway, but cannot be used to predict a trend. Examples of lagging indicators are as follows:

  • Business spending
  • Corporate profits
  • Inventory levels
  • Labor cost per unit of output
  • Loan default rates
  • Loan interest rates
  • Loans outstanding
  • Unemployment rate