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Benchmark Revisions - January 2008

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Released: Monday, October 24, 2011

The Conference Board Leading Economic Index® (LEI) for Australia declined 0.1 percent and The Conference Board Coincident Economic Index® (CEI) remained unchanged in August.

  •  The Conference Board LEI for Australia fell slightly in August following no change in July.  Stock prices declined sharply, more than offsetting positive contributions from gross operating surplus*, building approvals, and rural goods exports. Despite this month’s small decline, the six-month growth rate in the leading economic index continued to pick up, to 0.9 percent (about a 1.9 percent annual rate) through August 2011, from 0.2 percent (about a 0.3 percent annual rate) for the previous six months. However, the strengths and weaknesses among the leading indicators have been balanced in the last six months.
  • The Conference Board CEI for Australia, a measure of current economic activity, remained unchanged in August. Retail trade increased slightly after falling for three consecutive months, while employment continued to decline this month. Between February and August this year, the coincident economic index fell by 0.3 percent (about a -0.5 percent annual rate), a reversal from the increase of 0.3 percent (about a 0.5 percent annual rate) for the previous six months. At the same time, real GDP increased by 4.8 percent (annual rate) in the second quarter of 2011, up from the contraction of 3.4 percent (annual rate) in the first quarter of this year.
  • The Conference Board LEI for Australia has been falling for two of the last three months, but the declines have been small and the six-month growth rate of the index has been relatively stable so far this year. Meanwhile, The Conference Board CEI for Australia has been on a slightly downward trend since late last year.  Taken together, the recent behavior of the composite indexes so far suggests that economic growth could slow in the near term, and downward risks remain.

LEADING INDICATORS.  Five of the seven components in The Conference Board LEI for Australia increased in August.  The positive contributors to the index — in order from the largest positive contributor to the smallest — are gross operating surplus*, building approvals, rural goods exports, the sales to inventories ratio*, and yield spread.  Share prices and money supply* declined in August. 

With the 0.1 percent decrease in August, The Conference Board LEI for Australia now stands at 120.5 (2004=100).  Based on revised data, this index remained unchanged in July and declined 0.5 percent in June. During the six-month period through August, the leading economic index increased 0.9 percent, and three of the seven components increased (diffusion index, six-month span equals 50.0 percent).

COINCIDENT INDICATORS.  Three of the four components in The Conference Board CEI for Australia increased in August.  The increases – in order from the largest positive contributor to the smallest – occurred in industrial production*, household gross disposable income*, and retail trade.  Employed persons declined in August.

Holding steady in August, The Conference Board CEI for Australia now stands at 117.6 (2004=100).  Based on revised data, this index decreased 0.1 percent in July and remained unchanged in June.  During the six-month period through August, the coincident economic index decreased 0.3 percent, with two of the four components in the series making positive contributions (diffusion index, six-month span equals 50.0 percent).

DATA AVAILABILITY. The data series used to compute The Conference Board Leading Economic Index® (LEI) for Australia and The Conference Board Coincident Economic Index® (CEI) for Australia reported in this release are those available “as of” 10 A.M. ET on October 21, 2011.  Some series are estimated as noted below.

NOTES: Series in The Conference Board LEI for Australia that are based on our 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 Conference Board CEI for Australia that are based on our 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.

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