Common Economic Indicators for Analysis
June 29th, 2009 by ALVIN SOONG
These are some of the common economic indicators used for analysis. It was also mentioned in Straits Times. I summarised in here for reference:
1) Gross Domestic Product (GDP)
GDP (total value of goods and services produced by a country within its borders). Singapore Government expects GDP growth in ‘normal’ years to average between 4-6%. Beyond this figure, it shows booming economy.
2) Manufacturing output (value of the amount of goods that Singapore’s factories produce) which accounts for one-quarter of the economy, growth of 40 per cent in the industry roughly corresponds to 10 per cent growth in GDP
3) Non-oil domestic exports (NODX) , roughly 2X Singapore’s GDP to show positive growth.
4) Purchasing Managers’ Index (PMI). >50 indicating that manufacturing is growing, <50 meaning that activity is shrinking. This is one of the earliest monthly indicators of how the manufacturing sector is faring.
5) For services and retails industry, other indicators include Business Receipts Index & Retail Sales Index. The Business Receipts Index tracks sub-sectors like financial services, accounting, property services and telecommunications. Retail Sales Index include service sub-sectors like tourism and retail.
6) Straits Times Index that is a barometer of the stock market, Monthly home sales and unemployment rates are also lagging indicators.
