Definition: A lagging indicator is a measure that only changes after the economy has changed. It is of little use in looking ahead. However, they are helpful in confirming a trend. Unemployment is the most popular lagging indicator, because it shows whether companies anticipate things getting better or worse. If companies believe things are bad and getting worse, unemployment will rise. If they are more optimistic, then unemployment will fall.
Lagging Economic Indicators
By Ken Little, About.com
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