Forecasting Economic Conditions Using LEI

As a portfolio manager for a multi-family office, you have been assigned the task of preparing an economic outlook to guide investment decisions for the upcoming fiscal year. To enhance your analysis, you have the option to utilize various forecasting tools.

You are considering three different forecasting methods: the Leading Economic Index (LEI), a time-series regression model based on historical GDP growth, and sentiment surveys from CEOs.

Which of the following forecasting tools would best help you gauge turning points in the economic cycle and offer timely insights about potential future economic activity?