The Conference Board CEI for the U.S., a measure of current economic activity, also continued to increase in March. The index rose 1.5 percent (a 3.0 percent annual rate) between September 2010 and March 2011, modestly faster than the growth of 1.1 percent (a 2.2 percent annual rate) for the previous six months. In addition, the strengths among the coincident indicators have remained very widespread, with all components advancing over the past six months. This month, the lagging economic index increased more than the CEI, and the coincident-to-lagging ratio fell, as a result. Meanwhile, real GDP expanded at a 3.1 percent annual rate in the fourth quarter of 2010, after growing 2.6 percent (annual rate) in the third quarter.
The Conference Board LEI for the U.S. remains on a rising trend amid fairly widespread strength among its components. Its six-month growth rate dipped slightly this month, but remains faster than in the second half of last year. Meanwhile, The Conference Board CEI for the U.S. remains on an increasing path, and its six-month growth rate has been gradually strengthening. Taken together, the current behavior of the composite indexes and their components suggest that economic activity should continue to expand moderately in the near term.
LEADING INDICATORS
Six of the ten indicators that make up The Conference Board LEI for the U.S. increased in March. The positive contributors – beginning with the largest positive contributor – were the interest rate spread, building permits, the index of supplier deliveries (vendor performance), average weekly manufacturing hours, average weekly initial claims for unemployment insurance (inverted) and manufacturers' new orders for consumer goods and materials. The negative contributors – beginning with the largest negative contributor – were the index of consumer expectations, real money supply, stock prices, and manufacturers’ new orders for nondefense capital goods.
The Conference Board LEI for the U.S. now stands at 114.1 (2004=100). Based on revised data, this index increased 1.0 percent in February and increased 0.2 percent in January. During the sixmonth span through March, the leading economic index increased 3.8 percent, with seven out of ten components advancing (diffusion index, six-month span equals 70 percent).
COINCIDENT INDICATORS
All four indicators that make up The Conference Board CEI for the U.S. increased in March. The positive contributors to the index – beginning with the largest positive contributor – were industrial production, employees on nonagricultural payrolls, personal income less transfer payments, and manufacturing and trade sales.
The Conference Board CEI for the U.S. now stands at 102.9 (2004=100). This index increased 0.1 percent in February and increased 0.5 percent in January. During the six-month period through March, the coincident economic index increased 1.5 percent, with all four components advancing (diffusion index, six-month span equals100.0 percent).
LAGGING INDICATORS
The Conference Board LAG for the U.S. stands at 108.3 (2004=100) in March, with three of the seven components advancing. The positive contributors to the index – beginning with the largest positive contributor – were commercial and industrial loans outstanding, change in CPI for services, and change in labor cost per unit of output. The negative contributor was the average duration of unemployment (inverted). The ratio of manufacturing and trade inventories to sales, average prime rate charged by banks, and ratio of consumer installment credit to personal income held steady in March. Based on revised data, the lagging economic index increased 0.3 percent in February and decreased 0.4 percent in January.
