·
The Weekly Leading Index of the US economy published by the Economic
Cycle Research Institute (ECRI) fell another 0.9% last month, the fourth
down month in a row.
· The indicator's six-month growth rate fell to -3.4%. The y/y comparison still is positive due to weakness in 2001.
· Construction of the ECRI Leading Index differs from the Index of Leading Economic Indicators published by the Conference Board. Nevertheless there has been an 80% correlation between the annual percent change in the two over the last 20 years.
· The components of the index are money supply plus stock & bond mutual funds, the JOC-ECRI industrial materials price index, mortgage applications, bond quality spreads, stock prices, bond yields, and initial jobless insurance claims.
· The median lead of the ECRI index at
business cycle peaks has been 10.5 months and at cycle troughs 3.0
months. The sideways movement of the leading index in 2002 may or may
not signal something about the economy's growth rate.