Conference Board Leading Economic Index for U.S. declines 0.2%

The Conference Board Leading Economic Index (LEI) for the United States declined 0.2 percent in June to 109.8, following a 0.5 percent increase in May, and a 0.1 percent decline in April.

"The indicators point to slower growth through the fall," says Ken Goldstein, economist at The Conference Board. "Two trends will have a direct impact on the pace of economic expansion. First, improvement in the industrial core of the economy will moderate as inventory rebuilding slows. Second, improvement in the service sector has been relatively slow, with little indication that it will pick up momentum."

"The LEI decreased in two of the last three months, but its level is still about 4.5 percent above its previous peak before the recession began," says Ataman Ozyildirim, economist at The Conference Board. "Moreover, the gains among the LEI components have been widespread, with the exception of housing permits and stock prices, pointing to an expanding economy, but at a slower pace in the second half of the year."

The Conference Board Coincident Economic Index (CEI) for the U.S. was unchanged in June, following a 0.5 percent increase in May, and a 0.3 percent increase in April. The Conference Board Lagging Economic Index (LAG) increased 0.1 percent in June to 107.6, following a 0.1 percent decline in May, and a 0.3 percent decline in April.

About The Conference Board Leading Economic Index (LEI) for the U.S.
The composite economic indexes are the key elements in an analytic system designed to signal peaks and troughs in the business cycle. The leading, coincident, and lagging economic indexes are essentially composite averages of several individual leading, coincident, or lagging indicators. They are constructed to summarize and reveal common turning point patterns in economic data in a clearer and more convincing manner than any individual component - primarily because they smooth out some of the volatility of individual components.

The 10 components of The Conference Board Leading Economic Index for the U.S. include:

• Average weekly hours, manufacturing
• Average weekly initial claims for unemployment insurance
• Manufacturers' new orders, consumer goods and materials
• Index of supplier deliveries – vendor performance
• Manufacturers' new orders, non-defense capital goods
• Building permits, new private housing units
• Stock prices, 500 common stocks
• Money supply, M2
• Interest rate spread, 10-year Treasury bonds less federal funds
• Index of consumer expectations