Global| Jul 18 2014U.S. Leading Economic Indicators Point Toward Continued Growth
by:Tom Moeller
|in:Economy in Brief
Summary
The Index of Leading Economic Indicators, from the Conference Board, improved 0.3% during June (6.3% y/y), the fifth straight month of firm increase. The June gain fell short of expectations for a 0.5% increase in the Action Economics [...]
The Index of Leading Economic Indicators, from the Conference Board, improved 0.3% during June (6.3% y/y), the fifth straight month of firm increase. The June gain fell short of expectations for a 0.5% increase in the Action Economics Forecast Survey but May's increase was revised up to 0.7%. The breadth of component increase slipped to a still-firm 65%. A steeper interest rate yield curve, the leading credit index, and higher stock prices provided the strongest positive contributions to the rise. Detracting from the index's gain were fewer building permits and more initial unemployment insurance claims
A lower ratio of coincident-to-lagging indicators continued to temper the message of positive economic growth to come. It slipped to its lowest level of the economic recovery. The index measures how the economy is performing versus its excesses.
The index of coincident indicators increased 0.2% (2.3% y/y) following an unrevised 0.3% gain. Last month, all of the component series contributed positively to the total's rise. Payroll employment provided the greatest lift, followed by personal income less transfers, manufacturing & trade sales and industrial production.
The index of lagging economic indicators increased 0.5% last month following a revised 0.3% May rise. The 4.3% y/y rate of growth nearly matched the strongest 12-month increase reached early last year. A shorter duration of unemployment, another surge in C&I loans outstanding and a higher consumer credit-to-income ratio accounted for most of June's rise.
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.
The latest Beige Book from the Federal Reserve covering regional economic conditions can be found here.
| Business Cycle Indicators (%) | Jun | May | Apr | Y/Y | 2013 | 2012 | 2011 |
|---|---|---|---|---|---|---|---|
| Leading | 0.3 | 0.7 | 0.3 | 6.3 | 3.4 | 2.2 | 5.3 |
| Coincident | 0.2 | 0.3 | 0.2 | 2.3 | 1.9 | 2.3 | 2.6 |
| Lagging | 0.5 | 0.3 | 0.4 | 4.3 | 3.8 | 3.4 | 2.3 |
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.
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