NEW YORK - The composite index of Leading Economic Indicators rose 0.4% in December following a revised 0.2% gain in November, originally reported as a 0.5% increase, the Conference Board reported Thursday.
The coincident index grew 0.3% in December after an unrevised 0.1% gain in November, while the lagging index rose 0.3% after a 0.4% jump in November, originally reported as a 0.1% increase.
The LEI stands at 94.3, the coincident index is at 103.4 and the lagging index is at 113.4. The LEI has a baseline of 100, which reflects the level in 2004.
The annual benchmark revision was completed in January, resulting in a lower index level for LEI.
Economists polled by Thomson Reuters predicted LEI would be up 0.7% in the month.
“The CEI and other recent data reflect an economy that ended 2011 on a positive note and the LEI provides some reason for cautious optimism in the first half of 2012,” said the Conference Board economist Ken Goldstein. “This somewhat positive outlook for a strengthening domestic economy would seem to be at odds with a global economy that is losing some steam. Looking ahead, the big question remains whether cooling conditions elsewhere will limit domestic growth or, conversely, growth in the U.S. will lend some economic support to the rest of the globe.”
“Revised figures show that adding the new leading Credit Index, in conjunction with other changes, makes the LEI a more accurate predictor of the U.S. business cycles since 1990,” according to the Conference Board Economist Ataman Ozyildirim. “The improvement is especially pronounced before and during the 2008-2009 recession, and during the current expansion. In December, the LEI for the U.S. increased again. The gain was widespread among the leading indicators, suggesting economic conditions should improve in early 2012. However, the LEI gain in December was held back by negative contributions from the new Leading Credit Index – which indicates weak credit and financial conditions – and from consumer expectations for business ad economic conditions.”
