What is a cardboard box index?

The cardboard box index refers to the idea that an increase in the production of cardboard boxes is a leading indicator that goods manufacturing will increase, or that a decline in cardboard box production signals a manufacturing slowdown. It’s not foolproof in the slightest but it is typically used with other indicators to make assumptions.

Why is the cardboard box index a reliable measure of manufacturing?

The Cardboard Box Index is considered a reliable measure of manufacturing by some investors because it may reflect aggregate business estimates of future consumer goods sales. Approximately 75-80% of all non-durable goods are shipped in corrugated cardboard containers.

Does the cardboard box index lag behind GDP growth?

The cardboard box index does not consistently lead economic performance as measured by GDP and sometimes lags behind changes in GDP growth. Despite its popularity, neither the cardboard box index nor GDP displays a consistently leading relationship to trends and movements in the economy.