The BaR Analysis Grid^© uses economic indicators that correlate strongly with the ups and downs of a business cycle and show a consistent pattern of decline prior to recessions. Indicators can be divided into two groups: static and dynamic. Static indicators, like the Chicago Fed National Activity Index and the St. Louis Fed Financial Stress Index, have a consistent recession signal range, resulting in baselines that are are the same from business cycle to business cycle. Other indicators, such as retail sales and building permits, are dynamic, meaning that the indicator values and baseline estimate change with each business cycle.

The recession baselines for dynamic economic indicators are based on the values seen when previous recessions have started. During a business cycle, after an indicator hits a peak value it will decline until a recession starts. The baseline is determined by the average decrease of an indicator from it peak until the start of a recession in previous business cycles.

The charts shown below are snapshots taken in July 2025.   

Building Permits
Dynamic baseline; leading indicator

Chicago Fed National Activity Index
 Static baseline

Consumer Sentiment
Dynamic baseline; leading indicator

Real Nonfinancial Corporate Profits
Dynamic baseline

Credit Managers' Index (National Association of Credit Managers)
Static baseline

Existing Home Sales (National Association of Realtors)
Dynamic baseline

Industrial Production and Capacity Utilization
Dynamic baseline

Job Openings and Hires
Dynamic baseline

OECD Business Confidence Index
Dynamic baseline

Real Retail Sales Per Capita
Dynamic baseline

Small Business Optimism (National Federation of Independent Business)
Dynamic baseline; leading indicator

St. Louis Fed Financial Stress Index, Monthly Average
Static baseline; leading indicator

Temporary Employment
Dynamic baseline; leading indicator

Weekly Unemployment Claims, Monthly Average
Dynamic baseline; leading indicator

Vehicle Sales
Dynamic baseline, leading indicator