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Economy in Brief

U.S. Leading Economic Indicators Continue To Rise
by Tom Moeller  January 23, 2015

The Index of Leading Economic Indicators from the Conference Board increased 0.5% last month (6.4% y/y) following a 0.4% November rise, revised from 0.6%. Eighty five percent of the component series improved m/m. A steeper interest rate yield curve, the leading credit index, fewer initial claims for unemployment insurance, average consumer expectations for business/economic conditions and a higher ISM new orders index led the way upward. Building permits declined and the average workweek was unchanged. A 0.4% increase had been expected in the Action Economics Forecast Survey.

The index of coincident indicators edged 0.2% higher (3.0 y/y) following a 0.5% increase, revised from 0.4%. Three of the component series increased last month, including nonfarm payroll employment, personal income less transfers and business sales. Industrial production fell slightly.

The lagging indicators index increased 0.3% (3.7% y/y) following an unrevised 0.3% rise during November. During the last three months, growth has slowed to 2.3% (AR) from 5.1% as of March, suggesting that the buildup of economic excess has slowed. More C&I loans outstanding and the rise in the services CPI accounted for most of last month's increase, followed by a higher consumer installment credit/income ratio and a quicker change in labor costs.

The index of coincident-to-lagging indicators is a measure of how the economy is performing versus its excesses. It held steady last month for the second month.

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

Business Cycle Indicators (%) Dec Nov Oct Y/Y 2014 2013 2012
Leading 0.5 0.4 0.6 6.4 5.8 3.3 2.1
Coincident 0.2 0.5 0.3 3.0 2.5 1.9 2.6
Lagging 0.3 0.3 0.0 3.7 3.8 3.8 3.1
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