Economic Indicator - By Direction

By Direction

There are also three terms that describe an economic indicator's direction relative to the direction of the general economy:

• Procyclical indicators move in the same direction as the general economy: they increase when the economy is doing well; decrease when it is doing badly. Gross domestic product (GDP) is a procyclic indicator.
• Countercyclical indicators move in the opposite direction to the general economy. The unemployment rate is countercyclic: it rises when the economy is deteriorating.
• Acyclical indicators are those with little or no correlation to the business cycle: they may rise or fall when the general economy is doing well, and may rise or fall when it is not doing well.