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Economy in Brief

U.S. Leading Economic Indicators Rise
by Tom Moeller   September 23, 2010

The Conference Board reported that its Index of Leading Economic Indicators rose 0.3% during August after an unrevised 0.1% July uptick. Despite these gains, the three-month rate of increase decelerated to just 0.7% (AR), its weakest since March of last year when it was declining. The leading index is based on actual reports for eight economic data series. The Conference Board initially estimates two series, consumer and capital goods orders.

The breadth of increase amongst the component leading series improved m/m to 70%, its highest since March. A widened yield spread between 10-year Treasuries & Fed funds as well as a higher real money supply provided the largest positive influences on the August leading index. Other components exerted just minor influences.

The index of coincident indicators was unchanged for the second month in the last three. However, the three-month change of 0.4% was its weakest since October of last year. Three of the four component series ticked up last month including real personal income, business sales and industrial production. Payroll employment fell for the third month with the decline in the number of Census workers.

The lagging index rose for the third consecutive month as the duration of unemployment and labor costs rose. The ratio of coincident-to-lagging indicators (another leading indicator) fell for the third consecutive month.

The Conference Board figures are available in Haver's BCI database. Visit the Conference Board's site for coverage of leading indicator series from around the world. The latest U.S. Leading Indicators release can be found here.

Business Cycle Indicators (%) August July June 3Mo %Chg.
2009 2008 2007
Leading 0.3 0.1 -0.2 2.6 0.5 -2.7 -0.2
Coincident 0.0 0.1 0.0 0.4 -5.1 -1.2 1.4
Lagging 0.2 0.4 0.1 2.6 -1.6 3.2 3.0
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