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Economy in Brief
U.S. PPI Posts Broad-Based Strength in March
The Producer Price Index for final demand jumped 1.0% (4.2% y/y) during March...
U.S. Wholesale Inventories Post Strong February Gain; Sales Fall
Wholesale inventories increased 0.6% (2.0% y/y) during February...
U.S. Initial Unemployment Insurance Claims Unexpectedly Increase
Initial claims for unemployment insurance rose to 744,000 during the week ended April 3...
Total PMIs Gain Traction in March
The PMI readings for March show improvement again...
U.S. Consumer Credit Outstanding Bounces Back in February
Consumer credit outstanding surged $27.6 billion during February...
Viewpoints
Commentaries are the opinions of the author and do not reflect the views of Haver Analytics.
Monetary Policy Blunder: Not Managing Economic & Financial Outcomes Equally
Monetary Policy at a Crossroad: Policymakers Need to Break Promise of Easy Money to Avoid Boom-Bust
State Coincident Indexes in January
Data Surprises, Markets and COVID
by Tom Moeller March 19, 2020
The Conference Board's Composite Index of Leading Economic Indicators rose 0.1% during February following a 0.7% January increase, revised from 0.8%. The latest reading compared to zero change expected in the Action Economics Forecast Survey. The series is comprised of 10 components which tend to precede changes in the overall economy.
Last month's gain reflected mixed performance amongst the component series. Contributing positively to the index was the length of the factory sector workweek. Consumer expectations for business/economic conditions, factory orders for consumer goods & materials and the leading credit index also contributed positively. Having a negative effect on the leading index were the ISM new orders index, building permits, the interest rate spread between 10-year Treasuries and Fed funds, and initial claims for unemployment insurance. New orders for capital goods and stock prices exhibited neutral effects.
Three-month growth in the leading index held steady at 2.2% (AR). The y/y change of 0.7% compared to a 6.5% high in September 2018.
The Index of Coincident Economic Indicators rose 0.3% during February, its largest rise in three months. Each of the four the component series contributed positively to last month's index rise including payroll employment, personal income less transfer payments, industrial production and manufacturing & trade sales.
Three-month growth in the coincident index of 1.5% (AR) remained down from 3.5% in August 2018.
The Index of Lagging Economic Indicators rose 0.4% in February following stability in January. Contributing positively to the index change were the average duration of unemployment, the business sector inventory/sales ratio, growth factory sector unit labor costs and the ratio of consumer credit outstanding to personal income. Commercial & industrial loans outstanding had a negative effect. The prime rate charged by banks and growth in the services CPI had neutral effects.
Three-month growth in the lagging index remained low at 1.1%.
The ratio of coincident-to-lagging economic indicators is considered another leading indicator of economic activity. It slipped to 98.6 and remained in a sideways trend.
The Conference Board figures are available in Haver's BCI database; the components are available there, and most are also in USECON. The expectations are 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 | 2019 | 2018 | 2017 |
---|---|---|---|---|---|---|---|
Leading | 0.1 | 0.7 | -0.3 | 0.7 | 1.5 | 5.7 | 3.9 |
Coincident | 0.3 | 0.1 | 0.0 | 1.4 | 1.8 | 2.5 | 2.2 |
Lagging | 0.4 | 0.0 | -0.1 | 1.8 | 2.8 | 2.5 | 2.4 |