The Conference Board CEI for the U.S. also increased in December and it has gained in five of the last six months. Industrial production made a large positive contribution to the index, more than offsetting the decline in employment in December. Between June and December, the index has grown by 0.6 percent (1.2 percent annual rate). In December, the lagging economic index continued to decrease, and with the coincident economic index rising slightly, the coincident–to-lagging ratio increased further. Meanwhile, real GDP expanded at a 2.2 percent annual rate in the third quarter, its first increase since the second quarter of 2008.
The Conference Board LEI for the U.S. has risen steadily for nine months, and it has now risen above its most recent peak of March 2006. After steep gains earlier in 2009, its six-month growth rate has stabilized somewhat in recent months. Meanwhile, The Conference Board CEI for the U.S. has begun to improve slightly since July 2009, after a steep decline from December 2007 to June 2009. Taken together, the current behavior of the composite indexes suggests that economic conditions should continue to improve in the near term.
LEADING INDICATORS
Eight of the ten indicators that make up The Conference Board LEI for the U.S. increased in December. The positive contributors – beginning with the largest positive contributor – were interest rate spread, building permits, average weekly initial claims for unemployment insurance (inverted), stock prices, index of consumer expectations, index of supplier deliveries (vendor performance), money supply* and manufacturers' new orders for nondefense capital goods*. The average workweek of production workers and manufacturers' new orders for consumer goods and materials* held steady in December.
The Conference Board LEI for the U.S. now stands at 106.4 (2004=100). Based on revised data, this index increased 1.0 percent in November and increased 0.3 percent in October. During the six-month span through December, the leading economic index increased 5.2 percent, with eight out of ten components advancing (diffusion index, six-month span equals 80 percent).
COINCIDENT INDICATORS
Three the four indicators that make up The Conference Board CEI for the U.S. increased in December. The positive contributors to the index - beginning with the largest positive contributor – were industrial production, personal income less transfer payments and manufacturing and trade sales. The negative contributor to the index this month was employees on nonagricultural payrolls.
The Conference Board CEI for the U.S. now stands at 99.9 (2004=100). This index increased 0.1 percent in November and increased 0.1 percent in October. During the six-month period through December, the coincident economic index increased 0.6 percent, with three out of four components advancing (diffusion index, six-month span equals 75 percent).
LAGGING INDICATORS
The Conference Board LAG for the U.S. stands at 108.5 (2004=100) in December, with one of the seven components advancing. The only positive contributor to the index this month was change in labor cost per unit of output. The negative contributors – beginning with the largest negative contributor – were commercial and industrial loans outstanding, average duration of unemployment (inverted), and ratio of consumer installment credit to personal income. The ratio of manufacturing and trade inventories to sales, change in CPI for services and average prime rate charged by banks held steady in December. Based on revised data, the lagging economic index decreased 0.5 percent in November and decreased 0.2 percent in October.
