The Eurostat business cycle clock: A complete overview of the tool

Abstract

Fluctuations of the economy between periods of expansion and contraction have been subject to business cycle analysis for many years. However, the understanding of different cycles, such as business, growth and acceleration cycles, and their representation in an intuitive way is not straightforward. Moreover, users are confronted with large sets of economic indicators without having synthetic information on the current evolution of the economy. In this paper, we introduce the Eurostat business cycle clock (BCC), a visualization tool designed to complement traditional economic statistics. We will present the full methodological framework underlying the clock, including the statistical detection of turning points, empirical dating and assessment. The clock is available for the euro area and its member countries, although our presentation will focus on the euro area aggregate. Some brief considerations on the impact of the current COVID-19 crisis on the clock are included.