Global Business Cycle Indicators
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|Benchmark Revisions - January 2008|
Press Release Archive
Released: Thursday, May 24, 2007
The Conference Board announced today that the leading index for Australia increased 0.5 percent and the coincident index increased 0.2 percent in March.
- The leading index increased in March following a sharp increase in February. The largest contributor to the March gain was real money supply (M3), followed by building approvals. The six-month growth rate of the leading index picked up to a 2.9 percent rate (a 5.9 percent annual rate), slightly higher than the most recent high growth rate in August 2006 (almost a 5.6 percent annual rate). The strengths among the leading indicators have been somewhat more widespread than weaknesses in recent months.
- The coincident index increased slightly again in March. The coincident index has been rising steadily since early 2006, and the strengths among its components have remained very widespread. The largest contributor to the gain in March was retail trade. At the same time, real GDP grew about 2.8 percent (average annual rate) in the second half of 2006, (including a 4.2 percent rate in the fourth quarter), about the same average rate as in the first half of 2006. The recent behavior of the coincident and leading indexes suggests the economy should continue growing at a moderate to strong pace in the near term.
LEADING INDICATORS. Five of the eight components in the leading index increased in March. The positive contributors to the index — in order from the largest positive contributor to the smallest — are money supply*, building approvals*, share prices, gross operating surplus*, and the sales to inventories ratio*. The (inverted) "medium-term" government bond yield and rural goods exports* declined, while the yield spread remained unchanged in March.
With the 0.5 percent increase in March, the leading index now stands at 169.7 (1990=100). Based on revised data, this index increased 1.5 percent in February and declined 0.2 percent in January. During the six-month period through March, the leading index increased 2.9 percent, and five of the eight components increased (diffusion index, six-month span equals 62.5 percent).
COINCIDENT INDICATORS. All five components in the coincident index increased in March. The increases — in order from the largest positive contributor to the smallest — occurred in retail trade, the (inverted) unemployment rate, household gross disposable income*, employed persons and industrial production*.
With the increase of 0.2 percent in March, the coincident index now stands at 121.4 (1990=100). Based on revised data, this index increased 0.2 percent in February and increased 0.2 percent in January. During the six-month period through March, the coincident index increased 1.1 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 May 23, 2007. 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.