The ADS-index published by the Philadelphia FED represents efforts to account for higher-frequency data in a unifying statistical framework (Mixed-Frequency State Space Model). The -management-and-econometrics/economic-indices/us-economic-recession-indicator.html”>USRI is a real-time monthly indicator relying on customized optimization criteria which emphasize timeliness and reliability issues. Two different designs – statistical approaches, data – and, as expected, two different outcomes.
- I observed that the ADS-index flattened out since almost one year whereas the USRI is growing steadily.
- Many published indicators seem to confirm a growing-up dynamic.
- Which dynamic reflects the economy in the US: flat or up-wards? Did nothing happen between July 2009 and now (June 2010) or did `things' improve?
I'll attempt to propose an answer by relying on component time series.