U.S. Leading Economic Indicators Fall in May for Third Straight Month
by:Tom Moeller
|in:Economy in Brief
Summary
• Housing, stock prices & consumer expectations lead decline.
• Coincident indicators increase lessens.
• Lagging indicators strengthen.
The Conference Board's Composite Leading Economic Indicators index declined 0.4% during May (+3.0% y/y) after falling 0.4% in April, revised from -0.3%. The index also eased 0.1% in March. The May decline matched expectations in the Action Economics Forecast Survey.
Four of the Leading index's components fell in May including ISM orders, building permits, stock prices and consumer expectations. Five components increased including initial jobless insurance claims, consumer goods orders, nondefense capital goods orders, the interest rate yield curve and the leading credit index. The average workweek held steady.
The Index of Coincident Economic Indicators rose 0.2% (3.0% y/y) in May following a 0.5% increase in April, revised from 0.4%. Three of the index's four components rose including nonagricultural employment, personal income less transfers and real manufacturing & trade sales. Industrial production fell.
The Index of Lagging Economic Indicators increased 0.8% (4.7% y/y) after rising an unrevised 0.4% in April. Four of the index's seven components contributed positively to the overall increase in May including the average duration of unemployment, the prime rate charged by banks, commercial & industrial loans outstanding and the services CPI. Factory sector unit labor costs subtracted from the index and two components held steady including the business sector inventory/sales ratio and the consumer installment credit/income ratio.
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.
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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