Leading indicators are important tools that help us predict what will happen in the economy. They change before the economy starts to go up or down. This makes them really useful for spotting changes in the market.

Key Roles of Leading Indicators:

1. Predicting Trends:

   • For instance, how the stock market performs can give us hints about whether the economy will grow or shrink.

2. Helping Decision-Makers:

   • People who make economic policies use these indicators to guess what the economy will be like. If they see a rise in new homes being built, they might decide to raise interest rates to keep prices from going too high.

3. Understanding Public Feelings:

   • Indicators like consumer confidence surveys show how people feel about the economy. This can affect how much they choose to spend or invest.

In short, by looking at leading indicators, investors and decision-makers can make better choices. This helps keep the economy steady and encourages growth.