Macroeconomic indicators: beyond GDP

The macroeconomic indicators they are economic statistics that are periodically released by government agencies and private organizations. These indicators provide information on the economic performance of a particular country or region and, therefore, have a significant impact on the foreign exchange market and commercial operations.

Most important of macroeconomic indicators

Is he macroeconomic indicator more important that exists since it informs about the health of a country’s economy, by representing the total value of all goods and services produced during a specific period of time within a country (and without discounting capital consumption). It is usually expressed as a comparison with the production data obtained from the quarter or the previous year. It must be taken into account, when using this data, that the figure does not always reveal the reality that seems to be reflected after a first interpretation. So:

  • A high GDP does not imply a higher quality of life, it only reveals that the economic activity of that country is fully operational.
  • The figure provided by GDP does not reflect other realities such as welfare, the absence of criminality or sustainability.
  • Nor does it reflect technological advances and their impact on the economic growth of a country.

In summary, it could be said that it is a good reference but that it has important limitations, in particular, all the non-economic factors that it fails to take into account, such as social equality, access to education or public health or the environment.

Other macroeconomic indicators to consider

Besides of Gross Domestic Product, there is a long list of macroeconomic indicators that must be taken into account:

  • Consumer price index: measures changes in the prices of products in a shopping basket, informing about the possibility of inflation.
  • Production price index: reveals the results of the investigation of the price of goods at the wholesale level, showing the evolution of the benefits that producers obtain in exchange for the marketing of their products.
  • Unemployment rate: as well as other employment indicators, it helps to prevent inflationary processes and to know the reality that affects a large segment of the population, which is of working age.
  • Retail sales index: reports on the status of sales made in this sector for a period of one month.
  • Consumer confidence index: reveals the sentiment of consumers towards their spending potential and the general state of the economy in their region.
  • Factory orders: shows the industrial demand for perishable goods and durable goods.
  • Current account: it is the sum of the balance, factor income and cash transfers nationwide.

The International Monetary Fund disseminates, through the page website of the National Statistics Institute, a wide selection of economic and financial indicators Among those are labor costs, state operations, state debt, balance of payments, direct investment and portfolio or reserves, among many others.