Economy’s Growth Forecast To Continue
The U.S. economy expanded in June with The Conference Board’s Leading Economic Index (LEI) for the U.S. climbing 0.5 percent, the highest in recent months. Growth in the LEI was flat in May and increased 0.4 percent in April.
“The U.S. LEI increased in June, pointing to continuing solid growth in the U.S. economy,” says Ataman Ozyildirim, director of business cycles and growth research at The Conference Board. “The widespread growth in leading indicators, with the exception of housing permits which declined once again, does not suggest any considerable growth slowdown in the short-term.”
The Conference Board’s Coincident Economic Index (CEI), a measure of current economic activity, also increased in June, rising 0.3 percent to 103.9, following a 0.1 percent increase in May and a 0.2 percent increase in April. Its Lagging Economic Index, an indicator representing changes that come only after the economy has begun to follow a particular trend, ticked up 0.3 percent in June to 105.4, after an increase of 0.5 percent in May and a 0.4 percent decrease in April.
The Conference Board’s indexes are composites of leading, coincident and lagging economic indicators designed to highlight peaks and troughs in the business cycle that could be obscured by volatility within individual components. The LEI is comprised of 10 indicators: average weekly hours, manufacturing; average weekly initial claims for unemployment insurance; manufacturers’ new orders, consumer goods and materials; the Institute of Supply Management Index of New Orders; manufacturers' new orders, nondefense capital goods excluding aircraft orders; building permits, new private housing units; stock prices, 500 common stocks; the Leading Credit Index; the interest rate spread, 10-year Treasury bonds less federal funds; and average consumer expectations for business conditions.