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Benchmark Revisions - November 2006

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Released: Tuesday, February 11, 2014

The Conference Board Leading Economic Index® (LEI) for Japan decreased 0.3 percent and The Conference Board Coincident Economic Index® (CEI) remained unchanged in December.

  • The Conference Board LEI for Japan decreased slightly in December of last year. Declines in new orders for machinery and construction, the six-month growth rate of labor productivity and the index of overtime worked, more than offset gains in the remaining components. The leading economic index improved by 2.7 percent (about a 5.6 percent annual rate) from June to December 2013, less than half as fast as in the previous six months. However, the strengths among the leading indicators continued to be very widespread.
  • The Conference Board CEI for Japan remained unchanged in December, with two out of four components declining. Wage and salary income and employment contributed negatively to the index. However the six-month growth rate of the index improved to 0.4 percent (a 0.8 percent annual rate), moderately better than in the prior six months. The strengths and weaknesses among the coincident indicators continued to be equally balanced. At the same time, real GDP expanded at a 1.1 percent annual rate in the third quarter of last year.
  • The Conference Board LEI fell slightly in December and its rate of growth has been slowing in recent months. Meanwhile, the CEI remained unchanged but its six-month growth rate has improved. Taken together, the recent slowing growth in the LEI, coupled with moderate growth in the coincident economic index, suggest that the current expansion in economic activity is unlikely to gain momentum in the upcoming months.

LEADING INDICATORS. Six of the ten components that make up The Conference Board LEI for Japan increased in December.  The positive contributors to the index – in order from the largest positive contributor to the smallest – include (inverted) business failures, stock prices, interest rate spread, the Tankan business conditions survey, real money supply, and dwelling units started.  The negative contributors – in order from the largest negative contributor to the smallest – include the new orders for machinery and construction component*, the six-month growth rate of labor productivity and the index of overtime worked.  The real operating profits* remained unchanged in December.

With the decrease of 0.3 percent in December, The Conference Board LEI for Japan now stands at 101.0 (2004=100).  Based on revised data, this index increased 0.4 percent in November and increased 0.6 percent in October.  During the six-month span through December, the index increased 2.7 percent, and all ten components advanced (diffusion index, six-month span equals 100.0 percent).

COINCIDENT INDICATORS. One of the four components that make up The Conference Board CEI for Japan remained unchanged in December, while the only positive contributor to the index was industrial production.  The number of employed persons and wage and salary income declined in December.

The Conference Board CEI for Japan remained unchanged and now stands at 96.5 (2004=100).  Based on revised data, this index increased 0.1 percent in November and 0.2 percent in October.  During the six-month span through December, the index increased 0.4 percent, and two of the four components advanced (diffusion index, six-month span equals 50.0 percent).

DATA AVAILABILITY AND NOTES. The data series used to compute The Conference Board Leading Economic Index® (LEI) for Japan and The Conference Board Coincident Economic Index® (CEI) for Japan reported in this release are those available “as of” 5:00 P.M. ET February 7, 2014.  Some series are estimated as noted below.

* The series in The Conference Board LEI that are based on our estimates are the six-month growth rate of labor productivity, real operating profits and new orders for machinery.  The series in The Conference Board CEI that is based on our estimates is real manufacturing sales.

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

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