Leading Indicators Pointing Up

The Conference Board’s index of leading indicators for the month of February has been released and the February figure shows a reading of +0.7%.  Bloomberg had a consensus reading of +0.6%.  This was one of the best readings in almost a year.  Today’s strength follows a 0.2 percent gain in January and a 0.5 percent gain in December.

While this was the highest in a year, it was held back a bit by “still subdued consumer expectations and the purchasing managers’ index for new orders held the LEI back in February.”

The coincident index rose 0.2% to 104.0 and the lagging index rose 0.2 percent to 114.1.

As a reminder, most of the “leading” part of this already known by the time the data is released.  The ten components are as follows:

• Average weekly hours, manufacturing
• Average weekly initial claims for unemployment insurance
• Manufacturers’ new orders, consumer goods and materials
• ISM Index of New Orders
•   Manufacturers’ new orders, nondefense capital goods excluding aircraft orders
•   Building permits, new private housing units
•   Stock prices, 500 common stocks
•   Leading Credit Index™
•   Interest rate spread, 10-year Treasury bonds less federal funds
•   Average consumer expectations for business conditions

JON C. OGG