Definition of 'Seasonally Adjusted Annual Rate - SAAR'
A rate adjustment used for economic or business data that attempts to
remove the seasonal variations in the data. Most data will be affected
by the time of the year. Adjusting for the seasonality in data means
more accurate relative comparisons can be drawn from month to month all
year.
Our Expert explains SAAR 'Seasonally Adjusted Annual Rate - SAAR' - ( Data by fb.com/IBPSExamination )
The SAAR is calculated by dividing the unadjusted annual rate for the
month by its seasonality factor and creating an adjusted annual rate for
the month. These adjustments are more often used when economic data is
released to the public. The ice cream industry tends to have a large
level of seasonality as it will sell more ice cream in the summer than
in the winter. By using seasonally adjusted sale rates, the sales in the
summer can be accurately compared to the sales in the winter.
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