• The Hodrick-Prescott filter refers to a data smoothing technique used primarily in macroeconomics.

  • It is usually used during analysis to eliminate short-term fluctuations associated with the business cycle.
  • In practice, it is used to smooth and de-trend the Conference Board’s Need for Assistance Index so that it can be compared with the Bureau of Labor Statistics JOLTS, which measures the number of vacancies in the US.