What is Moving average?

A method of smoothing out random jumps in a time series: the average of a fixed number of consecutive periods is taken, then the "window" is shifted forward by one period and the calculation is repeated. The longer the window, the smoother the resulting line, but the later it shows new changes. The method partly removes cyclical and random fluctuations; a well-chosen window (for example, a 12-month one) also smooths out the seasonal effect. The resulting series has fewer observations than the original one. With an even-numbered window the average falls between periods, so it has to be centred additionally.

Source: Statistics Poland (GUS): moving average; INSEE: moving average