Global| Aug 29 2005ECRI Leading Index Suggests Economic Growth
by:Tom Moeller
|in:Economy in Brief
Summary
The leading index of the US economy published weekly by the Economic Cycle Research Institute (ECRI) stuttered in the last two periods but failed to reverse the sharp improvement in the measure since the low this past May. Since the [...]
The leading index of the US economy published weekly by the Economic Cycle Research Institute (ECRI) stuttered in the last two periods but failed to reverse the sharp improvement in the measure since the low this past May.
Since the low, growth in the leaders has improved to 3.2% after having been slightly negative for a short period.
During the last ten years there has been a 53% correlation between the change in the weekly leading index and the change in US real GDP growth during the following quarter. The correlation has risen to 72% during the last five years.
"But if recessions have historically been so hard to predict, why should you listen to us?" This quotefrom the book Beating the Business Cycle points out the difficulty of forecasting, especially when it concerns the future.
"To monitor just the U.S. economy, ECRI uses an array of 19 specialized leading indexes in the context of an “economic cycle cube” covering various sectors and aspects of the economy."
Visit the Economic Cycle Research Institute for analysis of US and international business cycles.
Fed Chairman Greenspan's closing remarks from the Jackson Hole, Wyoming symposium can be found here.
| Economic Cycle Research Institute | 08/19/05 | 12/31/04 | Y/Y | 2004 | 2003 | 2002 |
|---|---|---|---|---|---|---|
| Weekly Leading Index | 135.4 | 132.5 | 1.4% | 132.6 | 124.9 | 119.8 |
| 6 Month Growth Rate | 3.2% | 1.6% | 4.2% | 6.7% | 1.1% |
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
