Development Study of Leading Inflation Indicators with Big Data

Economic indicators are important indicator for economic actors and the government in a country. Economic actors and investors need those indicators to know if a country has a good investment climate. Meanwhile, the government uses economic indicators as the basis for policy making to maintain economic stability. One of the economic indicators that is often used to describe the economic climate is inflation.The movement of economic indicators, including inflation, is inseparable from the business cycle. Business cycle is an economic movement that has periods of expansion and contraction to form a cycle. Economic actors and the government need to know earlier on that movement in order to avoid inappropriate planning in the future. Therefore, a leading indicator is produced. Leading indicator is an indicator built as a composite of selected set of economic indicators that provides a strong signal from the cycle of a reference indicator. Leading indicators can act as predictors because the movement of this indicator precedes the cyclical movement of a reference indicator. In this publication, a study of the development of leading inflation indicators is carried out.