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Estimating Indexes of Coincident and Leading Indicators: An Application to Jordan

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  • Mr. Joannes Mongardini
  • Tahsin Saadi Sedik

Abstract

The analysis of coincident and leading indicators can help policymakers gauge the short-term direction of economic activity. While such analysis is well established in advanced economies, it has received relatively little attention in many emerging market and developing economies, reflecting in part the lack of sufficient historical data to determine the reliability of these indicators. This paper presents an econometric approach to deriving composite indexes of coincident and leading indicators for a small open economy, Jordan. The results show that, even with limited monthly observations, it is possible to establish meaningful economic and statistically significant relations between indicators from different sectors of the economy and the present and future direction of economic activity.

Suggested Citation

  • Mr. Joannes Mongardini & Tahsin Saadi Sedik, 2003. "Estimating Indexes of Coincident and Leading Indicators: An Application to Jordan," IMF Working Papers 2003/170, International Monetary Fund.
  • Handle: RePEc:imf:imfwpa:2003/170
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    3. Cotrie, Gladys & Craigwell, Roland & Maurin, Alain, 2009. "A review of leading composite indicators: making a case for their use in Caribbean economies," MPRA Paper 33390, University Library of Munich, Germany, revised 2009.
    4. Kathleen Dorsainvil, 2006. "Explaining Economic Performance in the Haitian Economy," Economía Mexicana NUEVA ÉPOCA, CIDE, División de Economía, vol. 0(1), pages 125-145, January-J.
    5. Michael Meow-Chung Yap, 2009. "Assessing Malaysia’s Business Cycle indicators," Monash Economics Working Papers 04-09, Monash University, Department of Economics.
    6. Matta Samer, 2015. "New Coincident and Leading Indexes for the Lebanese Economy," Review of Middle East Economics and Finance, De Gruyter, vol. 11(3), pages 277-303, December.
    7. Corina PÎRLOGEA & Ion POPA & Corina FR?SINEANU, 2012. "Macroeconomic Indicators Used to Study the Efficiency of Investments in Renewable Energy Field," Economia. Seria Management, Faculty of Management, Academy of Economic Studies, Bucharest, Romania, vol. 15(2), pages 308-315, December.
    8. Bhaghoe, Sailesh, 2018. "A Monthly Economic Activity Index System for Suriname," EconStor Preprints 226693, ZBW - Leibniz Information Centre for Economics.
    9. Alain Durré & Mr. Bernard J Laurens & Alexandre Chailloux, 2009. "Requirements for Using Interest Rates As An Operating Target for Monetary Policy: The Case of Tunisia," IMF Working Papers 2009/149, International Monetary Fund.
    10. Mr. Martin Petri & Tahsin Saadi Sedik, 2006. "To Smooth or Not to Smooth—The Impact of Grants and Remittances on the Equilibrium Real Exchange Rate in Jordan," IMF Working Papers 2006/257, International Monetary Fund.
    11. Vladimir Dubrovskiy & Inna Golodniuk & Janusz Szyrmer, 2009. "Composite Leading Indicators for Ukraine: An Early Warning Model," CASE Network Reports 0085, CASE-Center for Social and Economic Research.
    12. Adél Bosch & Steven F. Koch, 2020. "The South African Financial Cycle and its Relation to Household Deleveraging," South African Journal of Economics, Economic Society of South Africa, vol. 88(2), pages 145-173, June.
    13. Pandey, Radhika & Patnaik, Ila & Shah, Ajay, 2019. "Measuring business cycle conditions in India," Working Papers 19/269, National Institute of Public Finance and Policy.

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