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Benchmark Revisions - January 2008

Press Release Archive

Released: Monday, August 25, 2003

The Conference Board announced today that the leading index for Australia increased 0.3 percent and the coincident index was unchanged in June.

  • The leading index increased for the fourth consecutive month in June. After declining for two months in the beginning of the year, the index has now increased 1.5 % from its recent low in February.
  • While the coincident index was flat in June, it is still on a gradual upward trend. In addition, the six-month diffusion index has moved back up to 90 percent, indicating that the sources of growth are widespread.
  • Four consecutive and significant increases in the leading index suggest that the flat spot at the beginning of the year did little to stop the leading index’s upward trend. The pickup in the growth rate of the leading index since February is signaling stronger economic growth in the near term.

Leading Indicators. Four of the eight components in the leading index increased in June. The positive contributors to the index — in order from the largest positive contributor to the smallest — are money supply*, building approvals*, gross operating surplus*, and share prices. Three of the eight components of the leading index decreased in June. The negative contributors to the index — in order from the largest negative contributor to the smallest — are yield spread, (inverted) “medium-term” government bond yield, and rural goods exports*. The sales to inventories ratio* was unchanged.

With an increase in June, the leading index now stands at 149.9 (1990=100). Based on revised data, this index increased 0.5 percent in May and increased 0.4 percent in April. During the six-month span through June, the leading index increased 0.6 percent, and three of the eight components increased (diffusion index, six-month span equals 43.8 percent).

Coincident Indicators. Three of the five components in the coincident index increased in June. The increases - in order from the largest positive contributor to the smallest – occurred in retail trade*, household gross disposable income*, and industrial production*. The negative contributors to the index - in order from the largest negative contributor to the smallest – are employed persons and the (inverted) unemployment rate.

With no change in June, the coincident index now stands at 114.2 (1990=100). Based on revised data, this index increased 0.2 percent in May and increased 0.1 percent in April. During the six-month period through June, the coincident index increased 0.4 percent, with four components in the series making positive contributions (diffusion index, six-month span equals 90.0 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” 5 P.M. ET on August 21, 2003. Some series are estimated as noted below.

*Notes: Series in the leading index that are based on The Conference Board estimates are sales to inventory ratio and gross operating surplus for private non-financial corporations, the implicit price index used to deflate rural goods exports and building approvals. (Money Supply M3 levels from April 2002 are derived from growth rates reported by RBA). Series in the coincident index that are based on The Conference Board estimates are industrial production and household disposable income. CPI was used to deflate retail trade.

Due to the Reserve Bank of Australia’s discontinuation of the 3-month Treasury Bill (for details see “For the Record” in the June 2002 RBA bulletin), The Conference Board will use the Bank Accepted Bill 90 Days to calculate the yield spread from now on.

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

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