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A lagging indicator is an economic measure that confirms a trend that has already begun. It reflects past economic activity rather than predicting future changes. For example, Gross Domestic Product (GDP) is considered a lagging indicator because it captures economic decisions and trends that have already occurred. This is in contrast to a leading indicator, which signals a change in economic direction before it happens, such as corporate profits or stock prices. Lagging indicators are useful for confirming the direction of the economy after a turn has occurred.123

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