This tag gathers the analysis of leading signals of economic activity: PMIs, confidence surveys, economic surprises, financial conditions, composite indicators. These data help anticipate cyclical inflections before they appear in official statistics. It covers the reading and interpretation of these signals.
WTI, the U.S. barrel priced at Cushing, is not just a price — it is a macroeconomic barometer that compresses physical supply constraints, inflationary transmission, and geopolitical risk premium into a single daily signal. TL;DR WTI's grip on U.S. inflation…
T10YIE measures what markets expect; CPI measures what has actually materialized. The gap between the two is not an anomaly to be corrected — it is a signal in its own right, whose reading requires distinguishing level, direction, and cycle…
Forecasts do not miss cycle turns randomly. They miss them in the same direction every time: underestimating reversals, overestimating recoveries. The bias is methodological, not a competence gap — and it explains why the consensus arrives last to every turning point.
An isolated figure is never a signal. Three filters separate cyclical information from ambient noise: persistence over time, sectoral diffusion, and consistency across independent sources. Any indicator that fails all three is noise, regardless of how loud the coverage.
Five recurring errors corrupt the reading of the economic cycle: reacting to isolated figures, conflating correlation and causation, extrapolating from two points, ignoring revisions, and treating lagging indicators as leading signals. They rely on real data interpreted out of context — and trip up professionals as routinely as amateurs.
Markets price on a 12 to 18-month horizon while the real economy moves over years. The mismatch is structural, not cyclical — and it is the most reliable source of false cycle signals.
Confidence surveys measure a climate of opinion, not activity. The correlation between business sentiment and six-month-ahead GDP has fallen from 0.72 to 0.41 across OECD economies between 2010-2019 and 2020-2025 — a structural break that changes how these tools should be weighted in cycle diagnosis.
Leading indicators flag changes in conditions, not turning-point dates. The 22-month US yield curve inversion since 2022 shows how the same signal can fire for two different macroeconomic stories — and why directional convergence matters more than any single component.
Monthly data often provide a misleading picture of the economy due to volatility, statistical noise, and frequent revisions. TL;DR Monthly releases are unstable by construction, since noise, imperfect seasonal adjustment and later revisions can reverse the first reading, leaving a…
Equity ETF flows are an early barometer of investor positioning and the gradual return to risk. TL;DR Equity ETF flows act as an early read on positioning: in early 2026 they signal a measured return to risk, concentrated by region…
