A composite index of ten economic indicators that should lead overall economic activity. This indicator was initially compiled by the Commerce Department but is now compiled and produced by The Conference Board. It has been revised many times in the past 30 years - particularly when it has not done a good job of predicting turning points. Why Investors Care
| Released on 7/21/08 For Jun 2008 | ||||||||||||
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Highlights
The Conference Board's indexes of leading and coincident economic indicators continue to point to flat, soft conditions, but still not recessionary conditions. The leading index is softening, down 0.1 percent in June vs. a downwardly revised 0.2 percent decline in May that however follows a 0.1 percent rise in April. Money supply, which is an iffy indicator clouded by measurement difficulties, was the biggest negative for June followed by two substantial categories: stock prices and unemployment claims. The big plus for the report was a jump in building permits that however was tied to a one-time change in the New York City building code. A third month of decline in the next report would be a cause for concern. But the coincident indicator, which is closely watched as a signal for recession, rose 0.1 percent in June following a 0.1 percent decline in May and an unchanged reading in April. There was no reaction in the financial markets.
The Conference Board's index of leading indicators is not now pointing to recession but rather to an extremely sluggish economy. The leading index in May inched 0.1 percent higher for a second straight month. Generally, there needs to be three consecutive significant declines before the index correctly forecasts recession. But financial markets were a plus for May's data, perhaps a weak link that will shift in June. The coincident index, which is closely watched by the National Bureau of Economic Research for indications on the business cycle, advanced 0.1 percent following two prior months of 0.1 percent decreases -- results that again point to flat conditions.
Leading indicators Consensus Forecast for June 08: -0.1 percent
Range: -0.4 to +0.1 percent
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