The Conference Board CEI for the U.S., a measure of current economic activity, increased slightly in November. The six-month change in the coincident economic index continues to slow - to 0.4 percent (a 0.8 percent annual rate) through November 2010, down from 1.4 percent (a 2.8 percent annual rate) for the previous six months. In November, the lagging economic index decreased slightly, and with the small increase in the CEI, the coincident-tolagging ratio rose slightly. Meanwhile, real GDP grew at a 2.5 percent annual rate in the third quarter of 2010, following an increase of 1.7 percent annual rate in the second quarter.
The Conference Board LEI for the U.S. remains on an upward trend, with its six-month growth rate picking up lately. In addition, the strengths among its components have grown more widespread, and have slightly exceeded the weaknesses over the past six months.
Meanwhile, The Conference Board CEI for the U.S. has also been on a generally increasing path, although its six-month growth rate has continued to slow. All in all, the current behavior of the composite indexes and their components suggest that the economic expansion that began in mid-2009 will continue, and could even pick up slightly in the near term.
LEADING INDICATORS
Nine of the ten indicators that make up The Conference Board LEI for the U.S. increased in November. The positive contributors – beginning with the largest positive contributor – were the index of supplier deliveries (vendor performance), the interest rate spread, average weekly initial claims for unemployment insurance (inverted), real money supply, stock prices, the index of consumer expectations, average weekly manufacturing hours, manufacturers’ new orders for consumer goods and materials and manufacturers’ new orders for nondefense capital goods. The only negative contributor was building permits.
The Conference Board LEI for the U.S. now stands at 112.4 (2004=100). Based on revised data, this index increased 0.4 percent in October and increased 0.6 percent in September. During the six-month span through November, the leading economic index increased 2.2 percent, with six out of ten components advancing (diffusion index, six-month span equals 60 percent).
COINCIDENT INDICATORS
All four indicators that make up The Conference Board CEI for the U.S. increased in November. The positive contributors to the index – beginning with the largest positive contributor – were industrial production, personal income less transfer payments, employment and manufacturing and trade sales.
The Conference Board CEI for the U.S. now stands at 101.7 (2004=100). This index increased 0.2 percent in October and decreased 0.1 percent in September. During the six-month period through November, the coincident economic index increased 0.4 percent, with three out of four components advancing (diffusion index, six-month span equals 87.5 percent).
LAGGING INDICATORS
The Conference Board LAG for the U.S. stands at 108.6 (2004=100) in November, with two of the seven components advancing. The positive contributors to the index – beginning with the larger positive contributor – were change in CPI for services and the average duration of unemployment (inverted). The negative contributors – beginning with the largest negative contributor – were commercial and industrial loans outstanding, change in labor cost per unit of output in manufacturing, and the ratio of consumer installment credit outstanding to personal income. The ratio of manufacturing and trade inventories to sales, and average prime rate charged by banks held steady in November. Based on revised data, the lagging economic index remained unchanged in October and increased 0.6 percent in September.
