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Economy in Brief

U.S. Leading Economic Indicators Grow Stronger
by Tom Moeller  December 17, 2010

The Conference Board reported that its Index of Leading Economic Indicators rose 1.1% during November and nearly tripled its October increase, initially reported at 0.5%. The latest level of the index was a record high. These gains pulled the three-month rate of increase up sharply to 8.6% (AR), its strongest since March. 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 to 90%, its strongest since 2003. Higher vendor performance and a steeper interest rate yield curve together accounted for three-quarters of the November increase followed by lower initial claims for unemployment insurance, higher stock prices and improved consumer sentiment. Lower building permits made the one negative contribution to the leading index change.

The index of coincident indicators ticked higher for the second month. The three-month change of 1.2% remained down sharply from 4.5% during May. Each of the four component series ticked up last month including payroll employment, real personal income, business sales and industrial production.

The lagging index slipped 0.1% after four consecutive months of increase. The ratio of coincident-to-lagging indicators (another leading indicator) was unchanged.

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.

Business Cycle Indicators(%) Nov Oct Sept 3Mo %Chg AR 2009 2008 2007
Leading 1.1 0.4 0.3 8.6 0.5 -2.7 -0.2
Coincident 0.1 0.2 0.0 1.2 -5.1 -1.2 1.4
Lagging -0.1 0.3 0.4 2.2 -1.6 3.2 3.0
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