Haver Analytics
Haver Analytics
| May 19 2023

U.S. Leading Economic Indicators Decline Again in April

  • Leading index continues yearlong decline.
  • Coincident indicators rise again.
  • Lagging indicators edge lower.

The Conference Board's Composite Leading Economic Indicators Index fell 0.6% (-8.0% y/y) in April, off for the 13th consecutive month. A 0.5% decline had been expected in the Action Economics Forecast Survey.

Six of the Leading Index's ten components contributed negatively to the index change last month including initial claims for unemployment insurance, the ISM new orders index, building permits, the spread between the 10-Treasury note & the Fed funds rate, consumer expectations for business/economic conditions and the leading credit index. Factory orders for consumer goods, nondefense capital goods orders and stock prices contributed positively. The length of the average workweek held steady.

The Index of Coincident Economic Indicators rose 0.3% in April (1.7% y/y) following a 0.2% increase in March. Each of the four components of the index made positive contributions to the April increase including payroll employment, personal income less transfers, manufacturing & trade sales and industrial production.

Suggesting an easing of economic stress, the Index of Lagging Economic Indicators slipped 0.1% (+5.0% y/y) in April after holding steady in March. It was the first decline since August 2021. Three of the index's seven components made negative contributions to the index change including the average duration of unemployment, the change in unit labor costs and the change in the services CPI. The banks’ prime rate had a positive contribution while the business inventory-to-sales ratio, the consumer installment credit-to-income ratio and C&I loans outstanding held steady.

The ratio of the Coincident Index to the Lagging Index measures how the economy is performing in relation to potential excesses. It currently is suggesting economic improvement ahead. The ratio rose in April for the third month in the last four and now stands at the highest level in six months.

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.

  • 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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