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Economy in Brief

U.S. Leading Indicators Post Another Firm Gain
by Tom Moeller  March 22, 2012

The economic outlook is getting brighter. The Conference Board reported that its Leading Economic Indicator index gained 0.7% during February following a revised 0.2% January rise, last month reported as 0.4%. A 0.6% increase had been expected. Last month 80% of the component series rose. That's versus just 25% at the low last September. Lower initial claims for jobless insurance, a steeper interest rate yield curve, higher building permits and higher stock prices had the largest effects raising the overall leading index. The separate Leading Credit Index declined for a second month and indicated tighter conditions versus the easy state of last Summer & Fall.

The index of coincident indicators rose 0.2% for the second month. The y/y growth rate of 3.0% was its best since last March. Higher manufacturing & trade sales, increased payroll employment and improved personal income made positive contributions to the index change last month. Industrial production was unchanged.

The index of lagging indicators, designed to measure economic slack, rose 0.2% following a 0.5% January rise.

Another leading economic series is the ratio of coincident-to-lagging indicators. It measures how the economy is performing versus its excesses. It was unchanged last month but has been slipping since early last year.

The Conference Board figures are available in Haver's BCI database; the components are available there, and most are also in USECON. The forecast figure is the Consensus in the AS1REPNA database. Visit the Conference Board's site for coverage of leading indicator series from around the world.

Business Cycle Indicators (%) Feb Jan Dec Y/Y 2011 2010 2009
Leading 0.7 0.2 0.5 3.0 5.2 7.6 -12.8
Coincident 0.2 0.2 0.6 3.0 2.7 2.5 -7.7
Lagging 0.2 0.5 0.2 3.8 1.8 -2.9 -1.0
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