NEW YORK - The composite index of Leading Economic Indicators gained 0.6% in August, the Conference Board reported today.
LEI increased a revised 0.9% in July, originally reported as a 0.6% rise.
The coincident index was flat in August, after a revised 0.1% gain in July, originally reported as an unchanged reading, while the lagging index fell 0.1% after a revised 0.5% decline in July, originally reported as a 0.3% drop.
The LEI stands at 102.5, the coincident index is 99.8 and the lagging index is at 110.2.
Economists polled by Thomson Reuters predicted LEI would be up 0.7% in the month.
“Since reaching a peak in July 2007, the LEI fell for 20 months – the longest downward trend since the mid 1970s – but it has been rising since April and its gains have become very widespread,” according to the Conference Board Economist Ataman Ozyildirim. “The six-month growth rate of the LEI continues to accelerate. At the same time, the downward trend in the coincident economic index, measuring current economic activity, seems to be stabilizing, with the index flat so far this quarter.”
Five of the 10 indicators that comprise the LEI rose in August: index of supplier deliveries, interest rate spread, stock prices, building permits and the index of consumer expectations. Real money supply, average weekly initial claims for unemployment insurance, and manufacturers' new orders for nondefense capital goods were negative in the month. Average weekly manufacturing hours, and manufacturers' new orders for consumer goods and materials were flat in the month.
The coincident index saw industrial production, personal income less transfer payments and manufacturing and trade sales rise in the month. The negative contributor was employees on non-agricultural payrolls.
The lagging index saw positives from change in labor costs per unit of output, change in CPI for services, and average duration of unemployment. Commercial and industrial loans outstanding, the ratio of consumer installment credit to personal income, and the ratio of manufacturing and trade inventories to sales were negative. The average prime rate charged by banks was flat in the month.
