Seasonal Variation

When observations are taken at regular intervals within a year (by month or by quarter), most economic time series are likely to exhibit some degree of seasonal variation. An obvious example, known to everyone, is the existence of a ‘high’ and ‘low’ season for air transportation and other recreational activities. Perhaps less obvious, but equally important, is the presence of a seasonal pattern in most economic aggregates such as the index of production, price indices, the unemployment rate and so on.