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Economy in Brief

U.S. Index of Leading Economic Indicators Fall in September
by Tom Moeller  October 20, 2022

• Index has declined in most months this year.

• Coincident indicators continue to rise.

• Lagging indicators exhibit more strength.

The Conference Board's Composite Leading Economic Indicators Index declined 0.4% (-1.4% y/y) during September after holding steady in August, revised from -0.3%. The Action Economics Forecast Survey expected a 0.3% decline in the index for last month.

Four of the Leading Index's ten components made negative contributions in September. Declines came from new orders for nondefense capital goods excluding aircraft, consumer expectations for business/economic conditions, stock prices and the leading credit index.

The Index of Coincident Economic Indicators improved 0.2% last month (2.3% y/y) after it edged up an unrevised 0.1% in August. Each of the four index components rose including payroll employment, personal income, industrial production and business sales.

The Index of Lagging Economic Indicators increased 0.6% during September (6.9% y/y) following a 0.8% August gain, revised from 0.7%. Five of the index's seven components made positive contributions: the average duration of unemployment, the services CPI, the business inventory/sales ratio and the prime rate and C&I loans.

The ratio of the Coincident index to the Lagging index also is seen as a leading indicator. The ratio has been steadily declining since November, suggesting rising recession risks.

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.

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