Authors: Tain-Tsair Hsu（許添財）, Shin-Hsien Chen（陳世憲）

【Abstract】

The CDRI business cycle indicator shows that Coincidental Cyclical Composite Index for Service Industry (CCCIS) in April 2024 has indicated a continuous recovery for 20 consecutive months and has reached 1.1457 Standard Deviations after being standardized. Although the growth has slightly slowed, it’s forecasted to continue rising to 1.6243 Standard Deviations by October 2024, entering a historically “quasi-prosperous” stage. However, the Accommodation and Catering Industry, which led the post-pandemic recovery, ended its 21-month economic cycle in May 2023 and has shown significant growth deceleration by March 2024, indicating a possible resurgence of “uneven recovery” concerns.

With the economic up-ward fluctuations strengthening, all five sub-indicators of the CCCIS have reached their long-term trend values (100). However, the Accommodation and Catering Industry began to slow down and accelerate downward since June 2023. By March 2024, its cyclical trend value had dropped from a peak of 103.6 in May last year to 99.41, further decreasing to 98.8 in April 2024. This indicates that while the overall Service Industry recovery is at a steady pace, the Accommodation and Catering Industry has encountered a growth bottleneck, which is noteworthy.

The Leading Cyclical Composite Index for Service Industry (LCCIS) finally emerged from recession and entered recovery in April 2024, providing a more certain environment for the continued recovery of the overall Service Industry. However, the Private Fixed Investment decreasing and the increase in Initial Acceptance of Unemployment Benefits, which serve as “leading indicators of the Leading Indicators,” imply the uncertainty risk for the sustainability of a robust economic recovery has being increasing.

The LCCIS reached 0.0911 Standard Deviations in April 2024. Among the seven sub-indicators, four of them have shown an improvement in economic recovery, but the cyclical trends of Transportation and Storage Industry reversed from rising to declining, while the Net Service Trade shifted from decreasing to increasing, indicating significant changes. The Net Entry Rate of Employees in the Commercial Service Industry, the Stock Price Index for the Commercial Service Industry, and the Financial and Insurance Sectors showed stable growth. However, two sub-indicators, namely Private Real Fixed Capital Formation, and the Initial Acceptance of Unemployment Benefits (inverted), continued to deteriorate, showing limitations to the sustainably strong recovery of the overall economy.

There are some key points and implications regarding the changes in Business Forecast for Taiwan’s Commercial Service Industry in Q2 2024 as follows:

1.       The “uneven recovery” after the pandemic and the long-term “structural imbalance” in the industry have interacted, obstructing the path to overall economic recovery. This means that short-term economic fluctuation strategies and long-term economic development policies must be based on the specific needs of different industries with tailored strategies and policies, rather than relying on traditional general fiscal or monetary policies.

2.       The impact of the pandemic, coupled with geopolitical factors, has led to “uneven inflation,” a phenomenon where uneven recovery and inflation occur simultaneously, replacing concerns about “stagflation” after the Global Financial Crisis recovery.

The sectors and regions are experiencing “spiral inflation,” where both of demand and prices rise rapidly. This is due to productivity increases driven by technological advancements, which is enough to cope with the increase in wages derived from the increase in labor demand due to the increase in effective market demand, or the cost-push price increase that has forced wages to rise. As a result, prosperity and price increases coexist. It is a double-digit price and wage increase at the same time.

In contrast, sectors or regions lacking technological advancements face the threat of cost-push inflation without corresponding wage increases, exhibiting typical “stagflation.” The coexistence of spiral inflation and stagflation among the different sectors in the economy can be termed as “uneven inflation.”

“Uneven inflation” presents a situation with high growth opportunities yet extreme instability risks. Allowing the market to develop naturally under these circumstances could exacerbate distribution inequalities, ultimately impacting overall effective demand growth and social stability, leading to economic decline. General tightening policies can’t curb the spiral inflation in advanced sectors but could cause early or further decline in lagging sectors.

This further implies that, to ensure stable economic recovery and growth, tailored policies must be implemented for lagging sectors and regions. Observing the changes in the Cyclical Index System, it’s clear that these policies are particularly needed for traditional small and medium enterprises of manufacturing and Commercial Service Industries.

The commercial Service Industry led the recovery of overall economy after the pandemic, showing strong domestic demand but weak external demand, with its contribution to economic growth surpassing that of the Industrial Sector. Now, with the recovery of goods exports, the Industrial Sector’s contribution to economic growth has caught up with the Service Industry. However, in terms of the structure of exports, the AI boom has pushed the Semiconductor and ICT Industries to historical highs. Yet, traditional industries have fallen into a deep recession due to international market competition and changes in cross-strait relations. In the Commercial Service Industry, the Accommodation and Catering Industry, which initially led the recovery, is now showing signs of decline due to rising prices and labor shortages.

Uneven inflation not only occurs in the international community, but also in the economy of Taiwan. The inability to effectively improve the productivity of these two relatively backward sectors, the traditional manufacturing and Commercial Service Industries, will not only hinder the further growth of Taiwan’s economy, but will also continue to profoundly affect the general quality of life. Social injustice will also increase the risk to impact on political stability.

3.       The need of current efforts to promote industrial upgrading and improve industrial structure are clearly directed towards investment and employment by the signs of the Cyclical Index System. The implementation of tailored and precise strategies should focus on promoting new investments as well as training new talent and developing new technical skills. All of which are necessary for the “innovation value ecosystem.” What’s truly needed is qualitative change of “replacing the old with the new,” rather than quantitative change through “large leading small” or “strong merging weak,” to achieve the desired “new productivity reform movement.”

The lack of growth momentum in Private Fixed Investment has certainly stalled supply-side reforms. Rebuilding the innovation value ecosystem can provide incentives and momentum for new investments. The shortage of high-end, high-salary talent and low-end, low-wage labor evidently hinders labor supply innovation, affecting labor demand growth. The difficulty in finding talent in high-tech has affected the process of new investment, while small Commercial and Service Industries have gone out of business due to lack of workers. This happened during a recovery rather than a recession, which is rare in history. However, for Taiwan, which currently has abundant funds and advanced basic science and technology, it only needs one step of effective action with new mind-set and new vision to eliminate the dilemma of transformation and upgrading.

1. Comprehensive analysis and prediction

CDRI finds that the Coincidental Cyclical Composite Index for Service Industry (CCCIS) has bottom out in August 2022 of -0.8673 Standard Deviation. However, as of April 2024, the index has steadily risen to a positive value of 1.1457 Standard Deviations. It’s predicted that the index will continue to steadily increase and reach 1.6243 Standard Deviation by October 2024. It’s clearly seen that the economic recovery in the Commercial Service Industry is still robust, but the pace is slightly slower than previously predicted. (See Figure 1 and the appendix below)

Figure 1. “Tendencies and Forecasts of the Coincidental Cyclical Composite Index for the Service Industry”

Source: Business Cycle Forecasting Team, CDRI

Based on the data provided by the Directorate General of Budget, Accounting and Statistics, Executive Yuan, the economic growth rate of 2024 reached 6.56%. The main momentum behind economic growth is Net Exports, with a 49.04% growth, ranking first with a contribution of 5.49%, followed by Private Consumption with a contribution of 2.26%, and Public Sector expenditure (including Government Consumption, Government and Public Sector Investment). The total is 0.59%. Inventory increased by 502.38%, with a positive contribution of 0.14%. The negative growth of Private Investment is still serious and has the greatest impact on economic growth, with a negative contribution of 1.92%. (See Table 2 below.)

Table 2. Q1 2024 economic growth rate and growth contribution rate, by sector
                                                                         Unit: Millions of New Taiwan Dollars; %

Source: Directorate-General of Budget, Accounting and Statistics, Executive Yuan, and the Business Cycle Forecasting Team of CDRI

Table 3. Q1 2024 economic growth rate and growth contribution rate, by industry
                                                                              Unit: Millions of New Taiwan Dollars; %

Source: Directorate-General of Budget, Accounting and Statistics, Executive Yuan, and the Business Cycle Forecasting Team of CDRI

Upon further examination of different sectors and industries, it’s found that although Private Enterprise Investment continues to decline, with the decline narrowing for the first time, manufacturing and exports have recovered significantly, leading to the beginning of a reversal in the severe imbalance where domestic demand was strong while external demand was weak.

2. Service industry business cycle outlook

【Regarding the indicator system】

The business cycle Composite Index system on the Time Series Analysis. We analyze the relevant economic indicators in the time series and select indicators based on their significance to the business cycle and stability of their cyclicality.  They are then classified into leading indicators, coincident indicators, and lagged indicators through the use of statistical analysis and verification.

The cyclical trend of the Composite Index of coincident indicators is shown to be highly correlated with the cyclical trend of the GDP, and the forecast value of the Composite Index of the coincident indicators, estimated by the Leading Indicator Composite Index, could be used to forecast the moving trends of the GDP.

The cyclical trend of economic indicators fluctuates around the long-term trend. The long-term trend value is normalized to 100; cyclical trend values greater than 100 indicate a recovery or prosperity stage while values below 100 indicate a recession or depression stage.

The standardized changes of the indicators’ cyclical trend values (in Standard Deviation units) are added up to become a Composite Index, and it fluctuates around the long-term trend value with a Standard Deviation of zero.

【Latest Indicator Trends】

The Leading and Coincidental Composite Indices Curve for this business cycle’s indicator system is shown in Figure 2.

Leading Cyclical Composite Index (LCCIS) has dropped from its peak of 0.8533 Standard Deviations in November 2021 to -0.4646 Standard Deviations in June 2023. It then steadily increased to -0.0325 Standard Deviations in March 2024, and further rose to 0.0911 Standard Deviations in April.

The CCCIS has been directly affected by the pandemic, having fallen from its peak of 0.5917 Standard Deviations in September 2020, and turned negative starting in June 2021, reaching its lowest of -0.8673 Standard Deviations in August 2022. It then began to recover and reached a positive value of 0.0382 Standard Deviations in June 2023 and continued to rise to 1.1457 Standard Deviations in April 2024. It is predicted to continue rising to a positive value of 1.6243 Standard Deviations by October 2024. It’s evident that the Commercial Service Industry is poised for a sustainable and robust recovery. (See Figure 1 above and the attached appendix)

Figure 2. Leading and Coincidental Cyclical Composite Index for the Service Industry

Source: Business Cycle Forecasting Team, CDRI

A. Leading indicator series

a. Business cycle trend of real GDP of the Transportation and Storage Industry has stopped rising for the first time and turned to decline. Although the decline is slight, the boom is still strong, but the real annual growth rate has slowed down for three consecutive quarters, so we should pay attention to the follow-up development.

The cyclical tendency of this sub-indicator reached its lowest point in September 2021, and as of December 2023, it has been increasing for 27 consecutive months, with the index has reached 104.32, ranking as the highest among leading indicators.

However, the annual growth rate (YOY), calculated based on its actual value, has turned from negative to positive in Q2 2022, the fluctuation of the growth rate has increased, reaching 26.26% and 36.56% in Q1 and Q2 last year, respectively. Though it gets back to 27.53% in Q3 and continued to fall to 20.84% in Q4 2023 and 11.71% in Q1 2024, indicating a potential slowdown in the industry’s growth.

Figure 3. The annual growth rate of Transportation and Storage GDP and business cycle trend, 2020Q1~2024Q1

Source: Business Cycle Forecasting Team, CDRI and Directorate General of Budget, Accounting and Statistics, Executive Yuan

b. The cyclical trend of Private Real Fixed Capital Formation has been declining. After four consecutive quarters of negative growth in 2023 with increasing rates of decline, Q1 2024 saw a slight deceleration.

The cyclical tendency of this sub-indicator reached its peak in April 2022, with an index of 105.15, and declined all the way. In April 2023, the index fell below the long-term trend value. In April 2024, it has fallen to 92.55, (it has reached -2.0799 Standard Deviations after being standardized). It’s worth noting that the fervor of Private Investment once driven by the return of Taiwanese businesses is now significantly cooling down. The decline slowed slightly in Q1 2024.

In addition, the year-on-year growth rate (YoY) based on its actual GDP value was positive from 2020 to 2022. After peaking at 24.05% in Q3 2021, growth slowed, turning negative in Q1 2023, and reached -16.76% in Q4 2023. Although the decline slowed to -7.92% in Q1 2024, this is unfavorable for future productivity and economic growth.

Figure 4. Annual growth rate and cyclical trend of Private Real Fixed Capital formation, 2020Q1~2024Q1

Source: Business Cycle Forecasting Team, CDRI and Directorate General of Budget, Accounting and Statistics, Executive Yuan

c. The Net Balance of Trade in Services Revenue and Expenditure, which saw a rare surplus during the pandemic, has now reverted to the historical deficit norm. The deficit reappeared in Q1 2023 and persisted into Q1 2024. The annual change rate of the balance hit -366.42% in Q4 2023 but eased to -58.27% in Q1 2024. The cyclical trend value also rebounded from 87.38 in September 2023 to 93.31 in April 2024.

Looking at its actual GDP value, Taiwan’s service industry, which had enjoyed a rare trade surplus since Q2 2020, has encountered a reversal after 11 quarters. In Q1 2023, it has reemerged as a trade deficit, with the total annual service trade deficit amounting to $9.982 billion USD. This is equivalent to 10.64% of the total Merchandise Trade Surplus of $93.812 billion USD during the same period. The service sector had a $2.537 billion deficit in Q1 2024, 10.44% of the $24.305 billion commodity surplus.

The cyclical tendency of this sub-indicator hit a trough in September 2019 and reached a peak in January 2022, followed by a slight decline, and the decline continues to intensify. As of November 2022, the index was below the long-term trend value and was rapidly declining. As of August 2023, it has continued to accelerate its decline, reaching 87.36 (once being standardized, it’ll drop to a negative 2.3913 Standard Deviations). The trend has since risen, reaching 93.31 in April 2024 (-1.2322 Standard Deviations).

Looking at its actual GDP value of the Net Service Trade, it experienced a negative growth of -83.05% in Q4 2022, and -132.63% in Q1 2023, -160.47% in Q2, -229.02% in Q3 and -366.42% in Q4, before easing to -58.27% in Q1 2024, indicating a slowdown in the expanding deficit.

Figure 5. Annual growth rate and cyclical trend of net trade in Services Revenue and Expenditure, 2020Q1~2024Q1

Source: Business Cycle Forecasting Team, CDRI and Directorate General of Budget, Accounting and Statistics, Executive Yuan

d. Initial Acceptance of Unemployment Benefits (inverted) indicates that the economy is not doing well. While there is a severe labor shortage in the Accommodation and Catering Industry, the overall pressure on labor demand has eased.

The cyclical tendency of this sub-indicator reached its lowest value of 89.40 in May 2020, and then rose all the way, and had exceeded the long-term trend level of 100 in June 2021. It reached 110.52 at its peak in May 2022, indicating a rapid recovery in employment demand. However, it subsequently reversed and started declining. As of June 2023, the inverted Initial Acceptance of Unemployment Benefits had lower than the long-term trend value (100), and dropped to 89.85 as of April 2024, indicating a slowdown in employment demand. This uneven recovery reflects a structural mismatch in labor supply, with a shortage of both high-end, high-wage, and low-end, low-wage positions, hindering further economic growth.

Figure 6. Number of the initial acceptance of unemployment benefits (inverted) and the annual growth rate and cyclical trend January 2020 to April 2024

Source: Business Cycle Forecasting Team, CDRI and Directorate General of Budget, Accounting and Statistics, Executive Yuan

e. Net Entry Rate of Employees in the Commercial Services Industry has reached its lowest point in November last year, and rise all the way, indicating that there is a mild expansion in employment demand in the Service Industry.

The cyclical tendency of this sub-indicator reached its peak of 102.17 in October 2021, then began to decline, falling below the long-term trend value of 100 from June 2022, hitting its lowest point in November with a cyclical index of 98.41. In 2023, after the trend reversed from declining to rising, it experienced a gradual increase, reaching a cyclical trend value of 100.74 as of January 2024. This indicates a mild expansion in employment within the Commercial Services sector.

Figure 7. Annual changes and cyclical trends in the net entry rate of Employees in the Commercial Service Industry, January 2020 to March 2024

Source: Business Cycle Forecasting Team, CDRI and Directorate General of Budget, Accounting and Statistics, Executive Yuan

f. The declining trend of the Commercial Services sector’s Stock Price Index hit a low in June 2023 and has been gradually recovering.

The cyclical tendency of this sub-indicator has reached its peak October 2021, with an index of 108.53. This reflected the prosperous trend of the general stock market in Taiwan for the past year and a half. However, due to the lack of follow-up, it started to decline after reaching the peak, and has continued to decline for 27 months, reaching a low of 97.01 in June 2023. It has since been rising, reaching 98.99 in April 2024.

An indicator is the annual growth rate of the actual Stock Price Index. It turned negative in May 2022, and the decline continued to expand, with a drop of over 30% in September. In December and January 2023, the decline remained in double digits at -24.73% and -19.16%, respectively. Subsequently, the negative growth rates turned to single digits. The index has been fluctuating within single-digit ranges since May 2023 until April 2024, indicating that its trend is still experiencing relatively mild fluctuations. However, the decline is noticeably slowing down, and there is hope for a prompt return to stable recovery.

Figure 8. The annual growth rate and circular trend of the Stock Price Index of the commercial service industry, January 2020 to April 2024

Source: Business Cycle Forecasting Team, CDRI and Directorate General of Budget, Accounting and Statistics, Executive Yuan

g. The real GDP growth rate in the Finance and Insurance Sector had four consecutive quarters of negative growth and turned positive in Q2 2023. The cyclical trend, which experienced a continuous decline for one year, is currently on the rise.

The cyclical tendency of this sub-indicator reached its peak at 102.88 in July 2021, and then turned downward, returning to the long-term trend value (100) in April 2022, and has dropped to its trough 96.95 in January 2023. After reversing and starting to rise, it has increased to 104.63 by April 2024, with the pace of increase accelerating, indicating a stable recovery.

Also, looking at the annual growth rate (YOY), it turned negative starting in Q2 last year, with a growth rate of -2.86%. In Q3, it further decreased to -5.86%, followed by -9.82% in Q4, and -4.38% in Q1 2023, 2.86 in Q2, 4.65% in Q3, and a further acceleration to 12.12% in Q4, and a record high of 17.22% in Q1 2024, confirming the ongoing recovery.

Figure 9. Annual growth rate and cyclical trend of real GDP of Finance and Insurance Sector, 2020Q1~2024Q1

Source: Business Cycle Forecasting Team, CDRI and Directorate General of Budget, Accounting and Statistics, Executive Yuan

B. Coincident indicator series

a. The real GDP cyclical trend and actual values of the “Real GDP Index of Wholesale and Retail” have both been steadily rising for four consecutive quarters, indicating that the economy is gradually recovering and stabilizing.

The cyclical tendency of this sub-indicator reached its peak of 101.35 in April 2021. It has been declining since then and fell below the long-term trend value of 100 in July 2022, reaching a trough in February 2023 with a cyclical trend value of 98.95. It has since risen for four consecutive quarters, accelerating to 100.49 in April 2024, indicating a stable recovery.

Meanwhile, looking at the actual values annual growth rate. After declining by 4.13% in Q4 2022 and 7.01% in Q1 2023, there were subsequent increases of 1.03%, 0.73%, and 3.89% in Q2 to Q4, respectively, and rose by 5.46% in Q1 2024, indicating a stable recovery in the sector.

Figure 10. Annual growth rate and cyclical trend of real GDP Index of Wholesale and Retail, 2020Q1~2024Q1

Source: Business Cycle Forecasting Team, CDRI and Directorate General of Budget, Accounting and Statistics, Executive Yuan

b. “Real GDP of the Accommodation and Catering Industry” hit the bottom in August 2021, followed by a continuous and accelerated recovery. Although it peaked in May 2023, the cyclical trend has been declining for three consecutive quarters, indicating a slight slowdown in economic momentum. However, this has not yet impacted the overall economic outlook positively.

The cyclical tendency of this sub-indicator hit the bottom in August 2021, leading the economic recovery. The cyclical index steadily rose from the trough of 93.63, surpassing the long-term trend value of 100 by September 2022. In May 2023, the cyclical index reached its peak at 103.61. It then reversed its rise and started to decline, with the cyclical trend value falling to 98.82 by April 2024, indicating a risk of a slowing recovery.

The actual annual growth was severely impacted by the pandemic, reaching its lowest point at -29.53% in Q3 2021. It then started to rebound, but the growth rates in each quarter have been fluctuating. In Q3 2022 and Q2 2023, there were exceptionally high growth rates of 45.01% and 35.96%, respectively. In Q3, there’s still a 13.53% growth rate, and 8.62% in Q4, but slowed to 4.41% in Q1 2024, indicating a continued economic slowdown.

Figure 11. The annual growth rate and circular trend of real GDP in the Accommodation and Catering Industry, 2020Q1~2024Q1

Source: Business Cycle Forecasting Team, CDRI and Directorate General of Budget, Accounting and Statistics, Executive Yuan

c. Real GDP of Real Estate and Residential Service Industry business cycle trend is on the rise from its trough in Q4 2022. While there hasn’t been significant long-term cyclical fluctuation, it has returned above the long-term trend, with five consecutive quarters of growth, indicating a stable economic recovery.

The cyclical tendency of this sub-indicator fluctuates slightly over the long-term. The index peaked in November 2020, with a value of 100.66. From there, it gradually declined, and it fell below the long-term trend of 100 by December 2021 and accelerating downward. The downward trend gradually intensified but reached its lowest point in November 2022 with an index of 99.04. Subsequently, the upward momentum accelerated, reaching 101.48 by January 2024.

The actual annual growth rate reached -0.21% in Q4 2022 and continue to rise, with growth rates increasing each quarter: 0.09% in Q1 2023, 1.35% in Q2, 5.46% in Q3, and 6.65% in Q4, and 5.52% in Q1 2024, indicating a stable recovery.

Figure 12. Annual GDP growth rate and cyclical tendency of Real Estate and Residential Service Industry, 2020Q1~2024Q1

Source: Business Cycle Forecasting Team, CDRI and Directorate General of Budget, Accounting and Statistics, Executive Yuan

d. Real consumption of “Residential Services, Utilities, and Other Fuel Industries” has experienced relatively minor long-term fluctuations. However, after a slight decline in the economic cyclical trend over 21 months, there has been an upward trend for the past 12 months, indicating a genuine improvement in economic conditions.

The cyclical tendency of this sub-indicator showed little long-term fluctuation. It peaked in July 2021, reaching a cyclical trend value of 100.19. Subsequently, it gradually declined, hitting a trough in April 2023 at 99.90. As of April 2024, it has risen to 100.09.

Looking at the annual growth rate, growth has been observed in every quarter since 2020, but the magnitude of the fluctuations has been small. The annual growth rate has fluctuated between a high of 2.58% (in Q2 2020) and a low of 1.22% (in Q2 2022). In Q3 2021, there was a growth of 2.54%, reaching its peak. Subsequently, it fluctuated downward, hitting the lowest point in Q2 2022, with a growth of 1.22%. It then surged to 1.67% in Q3, followed by a gradual reduction in quarterly fluctuations. In Q4 2023, the growth rate has leaped to 2.06%, and maintained at 2.00% in Q1 2024, indicating that while the actual year-on-year growth remains positive, there hasn’t been significant long-term economic fluctuation, and the current cyclical trend has recovered since H2 2023.

Figure 13. Real Consumption of Residential Services, Utilities, and Other Fuel Industries, 2020Q1~2024Q1

Source: Business Cycle Forecasting Team, CDRI and Directorate General of Budget, Accounting and Statistics, Executive Yuan

e. The cyclical trend of Number of employees in the Service Industry has been rising continuously since June 2022. In May 2023, it surpassed the long-term trend value, indicating increased labor demand and growing pressure due to labor shortages.

The business cycle trend of this indicator hit a trough in May 2022, with an index of 99.48. After the decline, it gradually started to rise, and by May 2023, the trend value exceeded the long-term trend of 100. Furthermore, the momentum has continued to strengthen, with the cyclical index reaching 100.54 in April 2024 (once standardized, it’ll reach a positive 2.7849 Standard Deviations). It indicates an unprecedented prosperity in employment within the Commercial Service Industry, which complements the vibrancy in the Accommodation and Catering Industry. However, this mutual prosperity also comes with significant labor shortage pressures.

Looking at the annual growth rate, it has been consistently positive since December 2022, and the growth rate has been steadily increasing. Starting at 0.07% in December 2022, it has risen to 2.52% in September and 2.48% in October this year (2023). By January 2024, monthly growth rates exceeded 2%. However, from February 2024, the growth rate began to fall below 2%, slowing to 1.3% in April. This reflects that while labor demand is rising during the economic recovery, increased labor shortages are causing concerns about slower employment growth.

Figure 14. The growth rate and cyclical tendency of The Number of Employees in the Service Industry, January 2020 to April 2024

Source: Business Cycle Forecasting Team, CDRI and Directorate General of Budget, Accounting and Statistics, Executive Yuan

C. Lagged indicator series

The lagged indicator includes Real Consumption of Tobacco and Alcohol, Real Consumption of Clothing, Footwear, and Apparel, Real Consumption of Furniture, Equipment, and Housekeeping, and the Number of Initial Recognition and Acceptance of Unemployment Benefits. The Lagged Index can be used as a reference for observing whether a business cycle is over. This article omits relevant analysis.

Appendix

Business Cycle Coincident Composite Index for Taiwan Service Sector