Global| Jul 21 2016U.S. Leading Economic Indicators Rebound
by:Tom Moeller
|in:Economy in Brief
Summary
The Conference Board's Composite Index of Leading Economic Indicators increased 0.3% during June (0.7% y/y), following an unrevised 0.2% May decline. Expectations had been for a 0.2% rise in the Action Economics Forecast Survey. The [...]
The Conference Board's Composite Index of Leading Economic Indicators increased 0.3% during June (0.7% y/y), following an unrevised 0.2% May decline. Expectations had been for a 0.2% rise in the Action Economics Forecast Survey. The three-month change in the index improved to 2.3% (AR), but was still below its peak growth of 7.1% roughly one year ago. Lower initial claims for unemployment insurance had the largest positive impact on the total index followed by a steeper interest rate yield curve. The leading credit index also increased and most other components posted modest gains. A shorter average workweek provided the only negative influence on the total.
The coincident index increased 0.3% (1.8% y/y) following an unrevised no change. Three-month growth increased to 1.8% (AR). Each of the component series, including nonfarm payrolls, industrial production, personal income less transfers and manufacturing & trade sales contributed positively to the index.
The lagging index eased 0.1% after an upwardly revised 0.4% gain. Three month growth declined sharply to 2.0%. A shorter average duration of unemployment, fewer C&I loans outstanding and lessened growth in unit labor costs had the largest negative effects on the index. These were offset by faster growth in the services CPI, a higher consumer credit-to-income ratio and a higher inventory-to-sales ratio.
The ratio of coincident-to-lagging indicators also is a leading indicator of economic activity. It measures excesses in the economy relative to its ongoing performance. This ratio rose and reversed the prior month's decline, which was to the lowest level since 1961.
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 (%) | Jun | May | Apr | Jun Y/Y | 2015 | 2014 | 2013 |
|---|---|---|---|---|---|---|---|
| Leading | 0.3 | -0.2 | 0.5 | 0.7 | 4.3 | 5.8 | 2.9 |
| Coincident | 0.3 | 0.0 | 0.2 | 1.8 | 2.5 | 2.6 | 1.4 |
| Lagging | -0.1 | 0.4 | 0.2 | 3.4 | 3.7 | 3.7 | 3.9 |
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.
More Economy in Brief
