Overview
The composite leading and coincident indices are used to anticipate and identify the turning points of Singapore’s growth cycles respectively. These indices are reviewed periodically to ensure that they remain relevant.
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Our Data Explained
Business cycle literature distinguishes three types of cycles: classical cycle, growth cycle, and growth rate cycle. Singapore’s economic activity is characterised by growth cycles as it has generally been on an upward trend with relatively stable growths. More information is available from the article on Singapore’s Growth Cycle Chronology and Performance of Composite Leading Indicators.
Growth cycles are fluctuations in an economy’s growth rate, with peaks and troughs identified through statistical algorithms. Singapore's growth cycle chronology is determined by growth cycles identified from the Composite Coincident Index (CCI).
The CCI is an aggregate of five macroeconomic indicators that move in tandem with business cycles. It is generally regarded as a comprehensive representation of overall economic activity.
The Composite Leading Index (CLI) is a predictive tool for anticipating upturns and downturns in the economy. It comprises nine economic indicators that exhibit leading relationships with the growth cycles of the economy and is used to gauge if, and approximately when, an economic expansion or slowdown will take place.
Indicators for the CCI and CLI are selected based on a set of key criteria which include economic significance, cyclical properties, timeliness, periodicity, and the statistical quality of the data series. Periodic reviews are conducted to ensure the indicators’ adequacy and continued relevance in anticipating and identifying Singapore’s growth cycles.
More information is available from the information paper on Singapore's Growth Cycle Chronology, Composite Leading and Coincident Indices and article in the Statistics Singapore Newsletter Issue 2, 2023.