jepr İktisat Politikası Araştırmaları Dergisi 2148-3876 Istanbul University 10.26650/JEPR1761744 Macroeconomics (Other) Makro İktisat (Diğer) Financial Institutions Association Economic Outlook Index as a Leading Indicator of Real Economic Activity: A Time Series Analysis for Türkiye https://orcid.org/0000-0001-9990-9510 Saldanlı Arif ISTANBUL UNIVERSITY https://orcid.org/0000-0002-3756-3654 Sırma İbrahim ISTANBUL UNIVERSITY https://orcid.org/0000-0002-7856-2674 Bektaş Hakan ISTANBUL UNIVERSITY https://orcid.org/0000-0003-3925-6276 Şeker Murat ISTANBUL UNIVERSITY 02 19 2026 13 1 180 192 08 09 2025 11 07 2025 Copyright © 2014, Journal of Economic Policy Researches 2014 Journal of Economic Policy Researches

This study tests whether the Economic Outlook Index (FKB-EGE) published by the Financial Institutions Association (FKB) serves as a leading indicator for real economic activity in Türkiye using time series analysis methods. The FKB-EGE index, which is based on actual transaction data from factoring, financial leasing, and financing companies, differs from survey-based indicators in that it is constructed using data directly linked to real economic activity. In this study, the Industrial Production Index (IPI) published by the Turkish Statistical Institute (Turkstat) was used as an indicator of real economic activity. The analysis includes a time series of 124 periods covering monthly data from February 2015, when the FKB-EGE was first calculated, to May 2025. The findings obtained from the Granger causality tests and forecasting regression models applied indicate that FKB-EGE, and particularly the Financial Leasing sub-index, provide statistically significant and economically important information in forecasting the future trend of the IPI. The superior performance of the Financial Leasing Index in medium-term (3–6 months) forecasts aligns with theoretical expectations that leasing activities, which reflect investment decisions, serve as an important early warning signal for future production activity. These results suggest that the FKB-EGE could serve as a valuable real-time monitoring tool for policymakers and market analysts.

 Leading Indicators FKB Economic Outlook Index Industrial Production Index Time Series Analysis Granger Causality Acharya, V. V., & Richardson, M. P. (2009). Restoring financial stability: how to repair a failed system. John Wiley & Sons. google scholar Altuğ, S., & Uluceviz E. (2011). Leading indicators of real activity and inflation for Türkiye, 2001-2010. Koç University-TUSIAD Economic Research Forum Working Paper Series (No. 1111). google scholar Aramonte, S., Schrimpf, A., & Shin, H. S. (2022). Non-bank financial intermediaries and financial stability. BIS Working Paper No. 972. Bank for International Settlements. google scholar Arslan, Y., Atabek, A., Hülagü, T., & Şahinöz, S. (2015) Expectation errors, uncertainty, and economic activity. (TCMB Working Paper No. 1117). Central Bank of the Republic of Türkiye google scholar Atabek, A., Cosar, E. E., & Sahinöz, S. (2005). A new composite leading indicator of for Turkish economic activity. Emerging Markets Finance and Trade, 41(1), 45-64. [https://doi.org/10.1080/1540496X.2005.11052597google](https://doi.org/10.1080/1540496X.2005.11052597google) scholar Bernanke, B. S. (1983). Nonmonetary effects of the financial crisis in the propagation of the Great Depression. American Economic Review, 73(3), 257–276. [suspicious link removed] google scholar Bernanke, B. S., & Gertler, M. (1989). Agency costs, net worth, and business fluctuations. American Economic Review, 79(1), 14–31. [suspicious link removed] google scholar Bernanke, B. S., Gertler, M., & Gilchrist, S. (1994). The financial accelerator and the flight to quality (NBER Working Paper No. 4789). National Bureau of Economic Research. [https://doi.org/10.3386/w4789google](https://doi.org/10.3386/w4789google) scholar Bernanke, B. S., Gertler, M., & Gilchrist, S. (1999). The financial accelerator in a quantitative business cycle framework. In J. B. Taylor & M. Woodford (Eds.), Handbook of Macroeconomics (Vol. 1, Part C, pp. 1341–1393). Elsevier. [https://doi.org/10.1016/S1574-0048(99)10034-X](https://doi.org/10.1016/S1574-0048\(99\)10034-X) google scholar Canöz, İ. (2018). The causality relationship between Istanbul Stock Exchange 100 index and consumer confidence index: The case of Turkey. Fiscaoeconomia, 2(1), 136-153. [https://doi.org/10.25295/fsecon.366622](https://doi.org/10.25295/fsecon.366622) google scholar Camlica, F., Gunes, D., & Ozen, E. (2017). A financial connectedness analysis for Turkey. (TCMB Working Paper 1719). Research and Monetary Policy Department, Central Bank of the Republic of Turkey.google scholar Ćorić, B. (2011). The financial accelerator effect: concept and challenges. Financial Theory and Practice, 35(2), 171-196. google scholar Financial Stability Board. (2022). Global Monitoring Report on Non-Bank Financial Intermediation 2022. FSB. [https://www.fsb.org/2022/12/global-monitoring-report-on-non-bank-financial-intermediation-2022/google](https://www.fsb.org/2022/12/global-monitoring-report-on-non-bank-financial-intermediation-2022/google) scholar FKB. (2024). FKB Economic Outlook Index. Financial Institutions Association. [https://www.fkb.org.tr/](https://www.fkb.org.tr/) google scholar Foroni, C., Gelain, P., & Marcellino, M. (2022). The financial accelerator mechanism: Does frequency matter? (ECB Working Paper No. 2637). European Central Bank. [https://www.ecb.europa.eu/pub/pdf/scpwps/ecb.wp2637\~e8ac25af28.en.pdf](https://www.ecb.europa.eu/pub/pdf/scpwps/ecb.wp2637~e8ac25af28.en.pdf) google scholar Gallegati, M. (2014). Making leading indicators more leading: A wavelet-based method for the construction of composite leading indexes. OECD Journal: Journal of Business Cycle Measurement and Analysis, 2014(1), 1-21. [https://doi.org/10.1787/jbcma-2014-5jxx56gqmhf1.google](https://doi.org/10.1787/jbcma-2014-5jxx56gqmhf1.google) scholar Granger, C. W. J. (1969). Investigating causal relations by econometric models and cross-spectral methods. Econometrica, 37(3), 424–438. [https://doi.org/10.2307/1912791](https://doi.org/10.2307/1912791) google scholar Gyomai, G., & Wildi, M. (2012). OECD composite leading indicators for G7 countries: A comparison of the Hodrick-Prescott filter and the multivariate direct filter approach (OECD Statistics Working Papers, No. 2012/05). OECD Publishing. [https://doi.org/10.1787/5k4dhnzw8xr](https://doi.org/10.1787/5k4dhnzw8xr) google scholar Holmstrom, B., Tirole, J. (1997). Financial Intermediation, Loanable Funds, and the Real Sector. The Quarterly Journal of Economics, 112(3), 663–691. [https://doi.org/10.1162/003355397555316](https://doi.org/10.1162/003355397555316) google scholar Klapper, L. (2006). The Role of Factoring for Financing Small and Medium Enterprises. Journal of Banking & Finance, 30(11), 3111-3130. [https://doi.org/10.1016/j.jbankfin.2006.05.001](https://doi.org/10.1016/j.jbankfin.2006.05.001) google scholar Kraemer-Eis, H., & Lang, F. (2012). The importance of leasing for SME finance (No. 2012/15). EIF Working Paper. google scholar Leigh, D., Rossi, M. (2002). Leading indicators of growth and inflation in Türkiye (IMF Working Paper No. 02/231). International Monetary Fund. [https://www.imf.org/external/pubs/ft/wp/2002/wp02231.pdf](https://www.imf.org/external/pubs/ft/wp/2002/wp02231.pdf) google scholar Mitchell, W. C., & Burns, A. F. (1938). Statistical indicators of cyclical revivals (Bulletin 69). National Bureau of Economic Research. [http://www.nber.org/chapters/c4251](http://www.nber.org/chapters/c4251) google scholar Moore, G. H. (Ed.). (1961). Business cycle indicators. Princeton University Press for NBER. google scholar Özbilgin, H. M. (2017). Forecasting the growth cycles of the Turkish economy (TCMB Working Paper No. 17/15). Central Bank of the Republic of Türkiye. [https://www.tcmb.gov.tr/wps/wcm/connect/d2ffb048-bdb5-4ae0-9e61-1b02dfd1cc97/wp1715.pdf?mod=ajperes](https://www.tcmb.gov.tr/wps/wcm/connect/d2ffb048-bdb5-4ae0-9e61-1b02dfd1cc97/wp1715.pdf?mod=ajperes) google scholar Sırma, İ. Ş., Murat, Saldanlı, A., Bektaş, H., Bozoklu, Ş., Şişmanoğlu, E., & Uzun, S. (2025). Financial Institutions Association Economic Outlook Index Bulletin. Financial Institutions Association. google scholar Stiglitz, J. E., & Weiss, A. (1981). Credit Rationing in Markets with Imperfect Information. American Economic Review, 71(3), 393–410. [suspicious link removed] google scholar Stock, J. H., Watson, M. W. (2003). Forecasting output and inflation: The role of asset prices. Journal of Economic Literature, 41(3), 788-829. [https://doi.org/10.1257/002205103322436197](https://doi.org/10.1257/002205103322436197) google scholar Zarnowitz, V. (1992). Business cycles: Theory, history, indicators, and forecasting. University of Chicago Press. google scholar