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Economy in Brief

U.S. Leading Economic Indicators Fall
by Tom Moeller July 22, 2010

For the second month in the last three, the Conference Board reported that their Index of Leading Economic Indicators fell. During June, the index slipped 0.2% following a revised 0.5% May gain, initially reported at 0.4%, and a 0.1% April slip, earlier reported as no-change. The three-month rate of increase held steady at 7.2% (AR), still its weakest in roughly one year. The leading index is based on actual reports for eight economic data series. The Conference Board initially estimates two series, consumer and capital goods orders. 

The breadth of increase amongst the component leading series improved slightly m/m to 60%, still near its lowest since March of last year. A shorter workweek, quicker vendor delivery speeds, and lower stock prices had the largest negative influences on the June indicator index. These were offset by a steeper interest rate yield curve and a firmer money supply.

The index of coincident indicators was unchanged following seven months of moderate increase. The three-month change of 3.2% was off the May high of 4.9%. Three of the four component series rose last month including real personal income, business sales and payroll employment. Payroll employment fell with the decline in the number of Census workers. 

The lagging index ticked up 0.1% and has been little-changed since November. The ratio of coincident-to-lagging indicators (another leading indicator) slipped from the highest level since July, 2008.

The Conference Board figures are available in Haver's BCI database. Visit the Conference Board's site for coverage of leading indicator series from around the world. The latest U.S. Leading Indicators release can be found here.

Business Cycle Indicators (%) June May April March 6-Month %(AR) 2009 2008 2007
Leading -0.2 0.5 -0.1 7.9 0.5 -2.7 -0.2
Coincident 0.0 0.5 0.3 2.8 -5.1 -1.2 1.4
Lagging 0.1 -0.1 -0.3 -0.9 -1.6 3.2 3.0
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