The Conference Board CEI for the U.S. also increased in February, after remaining unchanged in January. Apart from employment, which continued to fall, all the other coincident indicators made small positive contributions to the index this month. Between August 2009 and February 2010, the CEI increased 0.6 percent (a 1.2 percent annual rate), a reversal from the decline of 1.7 percent (a -3.3 percent annual rate) during the previous six months. In February, the lagging economic index increased more than the CEI, and the coincident-to-lagging ratio decreased as a result. Meanwhile, real GDP expanded at a 5.9 percent annual rate in the fourth quarter of 2009, following an increase of 2.2 percent annual rate in the third quarter.
The Conference Board LEI for the U.S. has risen rapidly for almost a year now, but its six-month growth rate has continued to moderate. Meanwhile, The Conference Board CEI for the U.S. has risen slightly since July 2009, after declining sharply the previous year and a half. Taken together, the current behavior of the composite indexes suggests that the improving economic conditions should continue in the near term.
LEADING INDICATORS
Four of the ten indicators that make up The Conference Board LEI for the U.S. increased in February. The positive contributors - beginning with the largest positive contributor - were the interest rate spread, real money supply, index of supplier deliveries (vendor performance), and manufacturers' new orders for consumer goods and materials. The negative contributors - beginning with the largest negative contributor - were average weekly manufacturing hours, stock prices, the index of consumer expectations, building permits, manufacturers' new orders for nondefense capital goods*, and average weekly initial claims for unemployment insurance (inverted).
The Conference Board LEI for the U.S. now stands at 107.6 (2004=100). Based on revised data, this index increased 0.3 percent in January and increased 1.2 percent in December. During the six-month span through February, the leading economic index increased 4.4 percent, with all components advancing (diffusion index, six-month span equals 100.0 percent).
COINCIDENT INDICATORS
Three of the four indicators that make up The Conference Board CEI for the U.S. increased in February. The positive contributors to the index - beginning with the largest positive contributor - were personal income less transfer payments, industrial production, and manufacturing and trade sales. Employees on nonagricultural payrolls declined in February.
The Conference Board CEI for the U.S. now stands at 100.1 (2004=100). This index remained unchanged in January and increased 0.1 percent in December. During the six-month period through February, the coincident economic index increased 0.6 percent, with three out of four components advancing (diffusion index, six-month span equals 75.0 percent).
LAGGING INDICATORS
The Conference Board LAG for the U.S. stands at 108.0 (2004=100) in February, with three of the seven components advancing. The positive contributors to the index - beginning with the largest positive contributor - were change in labor cost per unit of output, average duration of unemployment (inverted), and ratio of consumer installment credit to personal income. Commercial and industrial loans outstanding declined in February. The ratio of manufacturing and trade inventories to sales, average prime rate charged by banks, and change in CPI for services* held steady in February. Based on revised data, the lagging economic index decreased 0.2 percent in January and decreased 0.4 percent in December.
