Leading Indicators Signal More Growth for Rest of 2013

The Conference Board indicated that this is now pointing to a gradually strengthening expansion through the end of the year. Ken Goldstein, economist at the Conference Board, said:

The improvement in the LEI, and pick up in the six-month growth rate, suggest better economic and job growth in the second half of 2013. However, the biggest uncertainties remain the pace of business spending and the impact of slower global growth on U.S. exports.

The Coincident Economic Index increased 0.2% in July to 106.3, after a 0.1% increase in June and a 0.3% increase in May. The Lagging Economic Index fell by 0.2% in July to 118.2 after a 0.2% gain in June and a 0.3% gain in May.

Again, much of the data making up the “leading indicators” is known ahead of time, which is why we often say that leading indicators are not exactly all that leading. Here are the indicators used for the reading:

• 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