Global Business Cycle Indicators
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|Benchmark Revisions - January 2008|
Press Release Archive
Released: Thursday, December 21, 2006
The Conference Board announced today that the leading index for Australia increased 0.3 percent and the coincident index increased 0.1 percent in October.
- The leading index increased in October, and September's unchanged value was revised to a small increase. The real money supply (M3) continued to be the largest positive contributor to the leading index. The leading index continued to grow at about a 3.5 percent annual rate in recent months, slightly down from its 4.0 to 4.5 percent rate growth in the middle of 2006. In addition, the strengths and weaknesses among the leading indicators have been balanced in recent months.
- The coincident index increased slightly again in October, continuing a trend of steady growth since mid-2005. In recent months, the strengths among the coincident indicators have been widespread. At the same time, real GDP grew at a 1.2 percent annual rate in the third quarter of 2006, down from the 2.2 percent average annual rate in the first half of the year. The recent behavior of the leading index still suggests that moderate economic growth is likely to continue in the near term.
LEADING INDICATORS. Four of the eight components in the leading index increased in October. The positive contributors to the index — in order from the largest positive contributor to the smallest — are money supply*, share prices, the sales to inventories ratio*, and gross operating surplus*. The (inverted) "medium-term" government bond yield, building approvals*, the yield spread, and rural goods exports* declined in October.
With the 0.3 percent increase, the leading index now stands at 164.4 (1990=100). Based on revised data, this index increased 0.1 percent in September and increased 0.2 percent in August. During the six-month period through October, the leading index increased 1.7 percent, and five of the eight components increased (diffusion index, six-month span equals 62.5 percent).
COINCIDENT INDICATORS. Three of the five components in the coincident index increased in October. The increases — in order from the largest positive contributor to the smallest — occurred in the (inverted) unemployment rate, retail trade, and household gross disposable income*. Industrial production* remained unchanged, while the number of employed persons declined in October.
With the increase of 0.1 percent in October, the coincident index now stands at 120.0 (1990=100). Based on revised data, this index increased 0.1 percent in both September and August. During the six-month period through October, the coincident index increased 0.9 percent, with all five components in the series making positive contributions (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 December 20, 2006. 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, and the CPI used to deflate money supply M3. 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.
THESE DATA ARE FOR ANALYSIS PURPOSES ONLY. NOT FOR REDISTRIBUTION, PUBLISHING, DATABASING, OR PUBLIC POSTING WITHOUT EXPRESS WRITTEN PERMISSION.