Global Business Cycle Indicators
|Benchmark Revisions - November 2006|
Press Release Archive
Released: Tuesday, January 10, 2012
This month's release incorporates annual benchmark revisions to the composite economic indexes, These regular benchmark revisions bring the indexes up-to-date with revisions in the source data. The revisions do not change the cyclical properties of the indexes. The indexes are updated throughout the year, but only for the previous six months. Data revisions that fall outside of the moving six-month window are incorporated when the benchmark revision is made and the entire histories of the indexes are recomputed. As a result, the revised indexes and their month-over-month changes will no longer be directly comparable to those issued prior to the benchmark revision.
The Conference Board Leading Economic Index® (LEI) for Japan decreased 0.2 percent The Conference Board Coincident Economic Index® (CEI) decreased 0.1 percent in November.
- The Conference Board LEI for Japan fell slightly in November following a sharp increase in October. Large declines in the index of overtime worked, stock prices, and the six-month growth rate of productivity more than offset positive contributions from dwelling units started, business failures (inverted), and real money supply. Despite the small decline this month, the leading economic index increased by 2.0 percent (about a 4.1 percent annual rate) between May and November this year, a reversal from the decline of 2.4 percent (about a -4.8 percent annual rate) for the previous six months. In addition, the strengths among the leading indicators have become more widespread than the weaknesses in the last six months.
- The Conference Board CEI for Japan, a measure of current economic activity, also decreased slightly in November. Industrial production fell sharply, while the rest of the coincident indicators increased this month. The coincident economic index increased by 3.8 percent (about a 7.8 percent annual rate) between May and November this year, a reversal from the decline of 4.2 percent (about a -8.2 percent annual rate) for the previous six months. Meanwhile, real GDP growth also picked up sharply in the third quarter this year, to 5.6 percent (annual rate), following a 2.0 percent contraction in the second quarter and a 6.6 percent contraction in the first quarter this year.
- The Conference Board LEI for Japan has been on a slightly upward trend in the last several months, despite month-to-month volatility. The six-month growth rate in the index has returned to positive territory, and even picked up further in November according to latest available data. Meanwhile, the rate of growth in The Conference Board CEI for Japan has also picked up in the last six months as the impact of the natural disasters wanes, but the index is still well below its most recent peak reached in the beginning of 2011. Taken together, the composite indexes and their components suggest that although near term risks to economic growth remain, economic activity should continue increasing in the coming months.
LEADING INDICATORS. Six of the ten components that make up The Conference Board LEI for Japan increased in November. The positive contributors to the index – in order from the largest positive contributor to the smallest – include dwelling units started, (inverted) business failures, real money supply, interest rate spread, the Tankan business conditions survey, and real operating profits*. The negative contributors – in order from the largest negative contributor to the smallest – include the index of overtime worked, the six month growth rate of labor productivity, stock prices, and the new orders for machinery and construction component*.
With the decrease of 0.2 percent in November, The Conference Board LEI for Japan now stands at 94.6 (2004=100). Based on revised data, this index increased 1.2 percent in October and decreased 0.5 percent in September. During the six-month span through November, the index increased 2.0 percent, and seven of the ten components advanced (diffusion index, six-month span equals 70.0 percent).
COINCIDENT INDICATORS. Three of the four components that make up The Conference Board CEI for Japan decreased in November. The positive contributors to the index – in order from the largest positive contributor to the smallest – include wage and salary income, number of employed persons, and the retail, wholesale, and manufacturing sales* component. Industrial production declined in November.
With the decrease of 0.1 percent in November, The Conference Board CEI for Japan now stands at 97.7 (2004=100). Based on revised data, this index increased 0.4 percent in October and increased 2.5 percent in September. During the six-month span through November, the index increased 3.8 percent, and all four components advanced (diffusion index, six-month span equals 100.0 percent).
DATA AVAILABILITY AND NOTES. The data series used to compute The Conference Board Leading Economic Index® (LEI) for Japan and The Conference Board Coincident Economic Index® (CEI) for Japan reported in this release are those available “as of” 5:00 P.M. ET January 5, 2012. Some series are estimated as noted below.
* The series in The Conference Board LEI that are based on our estimates are real operating profits and new orders for machinery. The series in The Conference Board CEI that is based on our estimates is real manufacturing sales.
**According to The Statistics Bureau and the Director-General for Policy Planning of Japan, figures in the Number of Employed Persons series from the three regions (Iwate, Miyagi and Fukushima) affected by the March 11th earthquake were missing from March through August 2011. From September 2011 on, this series again includes data for the whole of Japan. Thus, this series shows a sharp decline in March 2011 and a substantial gain in September 2011.
THESE DATA ARE FOR ANALYSIS PURPOSES ONLY. NOT FOR REDISTRIBUTION, PUBLISHING, DATABASING, OR PUBLIC POSTING WITHOUT EXPRESS WRITTEN PERMISSION.