In this article, I analyze a broad range of leading indicators—economic or financial data series that change in advance of the rest of the economy—to see which ones have done better at signaling past U.S. recessions.1 I also use these leading indicators to form a new index that outperforms existing leading indexes and the Treasury yield curve at signaling historical downturns.2| www.chicagofed.org
This article introduces improvements to the adjusted National Financial Conditions Index (ANFCI). Compared with the previous version, the new ANFCI uses an enhanced estimation procedure with a broader set of macroeconomic adjustment variables and produces a longer time series history.| www.chicagofed.org
National Financial Conditions Index (NFCI)| www.chicagofed.org