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Benchmark Revisions - July 2007

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Released: Tuesday, September 11, 2007

The Conference Board announced today that the leading index for the U.K declined 0.2 percent, and the coincident index increased 0.1 percent in July.

  • The leading index declined slightly in July following small gains during the previous two months. Order book volume and volume of expected output made the largest negative contributions to this month's decline in the leading index. As a result, the six-month growth rate of the leading index has slowed down to 2.1 percent (a 4.3 percent annual rate), but it is still above the 1.0 — 1.5 percent rate (about a 2.5 percent annual rate) at the end of 2006 and beginning of 2007. In addition, the strengths among the leading indicators have continued to be widespread in recent months.
  • The coincident index increased slightly again in June, and it has been on a moderately rising trend since mid-2006. In addition, the strengths among the coincident indicators have also become widespread in the last several months. During the last seven quarters, real GDP growth has stayed within the range of a 2.5 — 3.5 percent annual rate, and it grew at almost a 3.0 percent average annual rate in the first half of 2007 (including a 3.3 percent rate in the second quarter). The recent behavior in both the leading and coincident indexes so far suggests that economic growth is likely to continue at a moderate pace in the near term.

LEADING INDICATORS. Three of the seven components that make up the leading index increased in July. The positive contributors — from the largest positive contributor to the smallest — were consumer confidence, productivity for the whole economy*, and operating surplus of corporations. The negative contributors — from the largest negative contributor to the smallest — were order book volume, volume of expected output, yield Spread, and stock prices.

With the 0.2 percent decrease in July, the leading index now stands at 129.6 (1990=100). Based on revised data, this index increased 0.2 percent in both June and May. During the six-month span through July, the leading index increased 2.1 percent, with six of the eight components advancing (diffusion index, six-month span equals 92.9 percent).

COINCIDENT INDICATORS. Three of the four components that make up the coincident index increased in July. The positive contributors — from the largest positive contributor to the smallest — were employment *, retail sales, and real household disposable income*. Industrial production declined in July.

With the increase of 0.1 percent in July, the coincident index now stands at 118.5 (1990=100). Based on revised data, this index increased 0.1 percent in both June and May. During the six-month period through July, the coincident index increased 0.7 percent, with all four components advancing (diffusion index, six-month span equals 100.0 percent).

DATA AVAILABILITY: The data series used by The Conference Board to compute the two composite indexes reported in the tables in this release are those available "as of" 10 A.M. ET on September 10, 2007. Some series are estimated as noted below.

* Series in the leading index that are based on The Conference Board estimates are productivity of the whole economy, and operating surplus of corporations. Series in the coincident index that are based on The Conference Board estimates are employment and real household disposable income.

THESE DATA ARE FOR ANALYSIS PURPOSES ONLY. NOT FOR REDISTRIBUTION, PUBLISHING, DATABASING, OR PUBLIC POSTING WITHOUT EXPRESS WRITTEN PERMISSION.

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