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Benchmark Revisions - May 2008

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Released: Thursday, May 17, 2007

The Conference Board announced today that the leading index for Mexico increased 1.0 percent and the coincident index decreased 0.2 percent in March.

  • The leading index increased sharply in March, but February's increase was revised down to a decrease as actual data became available for the construction component of industrial production. Large positive contributions from stock prices and crude oil prices offset a large negative contribution from the inverted real exchange rate. With the increase in March, the leading index increased at a 0.3 percent rate (about a 0.6 percent annual rate) from September to March, the first positive growth rate in the last six months. But, this is down from the rapid growth of about a 6.0 to 7.0 percent annual rate in the middle of 2006.
  • The coincident index fell slightly in March for the fourth consecutive month, driven by a decline in industrial production and an increase in the unemployment rate. The growth of the coincident index has been volatile in 2006 and it has moderated somewhat in recent months. The strengths and weaknesses have been balanced among the coincident indicators in recent months. At the same time, real GDP slowed to a 1.9 percent rate in the fourth quarter, down from the 6.3 percent average annual rate in the first half of the year.
  • Despite the improvement in March, the leading index is essentially at the same level as in December, and it is still almost 1.5 percent below its most recent high in July 2006. The recent behavior of the composite indexes suggests that slow economic growth is likely to continue in the near term.

LEADING INDICATORS. Four of the six components that make up the leading index increased in March. The positive contributors to the index — from the largest positive contributor to the smallest one — are stock prices, the US refiners' acquisition cost of domestic and imported crude oil, the industrial production construction component*, and net insufficient inventories. The (inverted) real exchange rate decreased in March. The (inverted) federal funds rate remained unchanged.

With the 1.0 percent increase in March, the leading index now stands at 160.2 (1990=100). Based on revised data, this index declined 0.3 percent in February and declined 0.8 percent in January. During the six-month span through March, the index increased 0.3 percent, with one of the six components increasing (diffusion index, six-month span equals 16.7 percent).

COINCIDENT INDICATORS. One of the four components that make up the coincident index increased in March. The number of people employed (measured by IMSS beneficiaries)* increased in March. The (inverted) unemployment rate and industrial production declined, while retail sales* remained unchanged in March.

With the decrease of 0.2 percent in March, the coincident index now stands at 118.0 (1990=100). Based on revised data, this index decreased 0.3 percent in February and decreased 0.1 percent in January. During the six-month span through March, the index increased 0.1 percent, with two of the four components increasing (diffusion index, six-month span equals 62.5 percent).

DATA AVAILABILITY. The data series used to compute the two composite indexes reported in the tables in this release are those available "as of" 10 A.M. May 15, 2007. Some series are estimated as noted below.

NOTES: Series in the leading index based on The Conference Board estimates include industrial production — construction component. The series in the coincident index based on The Conference Board estimates include retail sales and unemployment rate.

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

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