By Seraph.Lapuma 2008-11-17 18:18:24
From my understanding, the Economic Index is similar to that of the Consumer Price Index (CPI). Basically, several items are selected from the FFXI economy, big items and small items (peacock charm, scorpion harness, a stack of gold ingots etc. etc. etc.), are added together and tracked everyday to show a trend. That trend is reflected on the main page with all the percent changes. This is also why you may see sudden spikes in some of the data. That day, there may have been an overbid on an item that would throw off the data.
It's main purpose, in my opinion, is to help track inflation. If the numbers start going up very quickly, keeping gil on hand is not a great idea. This is because everyday your gil is on hand, it is worth less, so ideally it would be best to buy something with limited availability. Quick examples would be things like an extra peacock charm or even d-ingots. Inversely, if the numbers are declining rapidly, your best bet is to keep gil on hand.
Hope this helps!
Lapuma