Global| Jul 20 2017U.S. Leading Economic Indicator Gain Improves
by:Tom Moeller
|in:Economy in Brief
Summary
The Conference Board's Composite Index of Leading Economic Indicators increased 0.6% (4.0% y/y) during June following a 0.2% May gain, revised from 0.3%. It was the strongest increase since January. A 0.3% rise had been expected in [...]
The Conference Board's Composite Index of Leading Economic Indicators increased 0.6% (4.0% y/y) during June following a 0.2% May gain, revised from 0.3%. It was the strongest increase since January. A 0.3% rise had been expected in the Action Economics Forecast Survey. Three-month growth improved to 4.5% (AR) versus 3.5% in May.
Most of the component series contributed positively to the leading index last month, including an increased number of building permits, a higher ISM new orders index, a steeper interest rate yield curve, the leading credit index, improved consumer expectations for business & economic conditions and higher stock prices. More initial unemployment insurance claims contributed negatively and the workweek was stable.
The Index of Coincident Economic Indicators rose 0.2% last month (2.0% y/y) after an upwardly revised 0.3% May gain. The latest rise strengthened three-month growth to 2.5% (AR), its best since December. Each of the component series contributed positively to the latest increase, including payroll employment, real personal income less transfers, industrial production and manufacturing & trade sales.
The Index of Lagging Economic Indicators also increased 0.2% during June following an unrevised 0.1% May uptick. Three-month growth held steady at 2.3%. A higher prime rate and a higher consumer installment credit/personal income ratio were offset last month by slower growth in the services CPI and fewer commercial & industrial loans outstanding.
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 has been fairly steady since early last year.
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 | 2016 | 2015 | 2014 |
|---|---|---|---|---|---|---|---|
| Leading | 0.6 | 0.2 | 0.2 | 4.0 | 1.2 | 4.4 | 5.6 |
| Coincident | 0.2 | 0.3 | 0.2 | 2.0 | 1.6 | 2.3 | 2.5 |
| Lagging | 0.2 | 0.1 | 0.3 | 2.4 | 3.4 | 3.7 | 3.6 |
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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