Year: 2026
Type: article
Abstract: We construct a monthly Hong Kong Composite Leading Index that closely tracks Hong Kong's economy. This index has strong correlations with real economic indicators and perfectly predicts downturns like COVID‐19 epidemic. In forecasting exercises, a 1% rise in the index predicts roughly 0.7% increase in Gross Domestic Product (GDP) growth. These findings are robust against alternative index designs and various checks. The index can be updated monthly ahead of GDP release for policy makers and financial analysts. It is overall a timely, transparent, and empirically validated gauge of Hong Kong's economy.
Source: Contemporary Economic Policy
DOI: 10.1111/coep.70051
Authors: Yun Huang, Yun Liu, Meng Ding
Institutions: CITIC Group (China), Hong Kong Polytechnic University
Language: English
Domain: Social Sciences
Open Access status: bronze
OpenAlex ID: W7203628131