Global Business Cycle Indicators


Press Release Archive

Released: Friday, December 17, 2004

The Conference Board announced today that the leading index for Mexico increased 1.5 percent and the coincident index increased 0.3 percent in October.

  • The leading index increased sharply in October, with stock prices and oil prices again being the major contributors to this month’s gain. However, September’s sharp increase was revised down as actual data for the construction component of industrial production became available. The net result is that the moderate weakness in the leading indicators observed in the second quarter of 2004 did not persist, but the growth rate of the leading index is still below its peak reached earlier this year.
  • The coincident index also increased in October, and has been on a flat to slightly rising trend since the beginning of 2004. At the same time, real GDP growth slowed to a 2.7 percent annual rate in the third quarter of 2004, down from a 4.8 percent average rate in the first half of 2004. The pick up in the growth rate of the leading index in recent months suggests that the economy will continue growing in the near term, perhaps in between the first half of the year’s strong growth and the third quarter’s sluggish growth.

Leading Indicators.Three of the six components that make up the leading index decreased in October. The negative contributors to the index—from the largest negative contributor to the smallest one—are net insufficient inventories, the industrial production construction component*, and the (inverted) federal funds rate. US refiners acquisition cost of domestic and imported crude oil, stock prices, and the (inverted) real exchange rate increased in October.

With the increase of 1.5 percent in October, the leading index now stands at 147.5 (1990=100). Based on revised data, this index increased 0.1 percent in September and increased 0.8 percent in August. During the six-month span through October, the index increased 2.4 percent, with two of the six components increasing (diffusion index, six-month span equals 33.3 percent).

Coincident Indicators.Three of the four components that make up the coincident index increased in October. The positive contributors were number of people employed (measured by IMSS beneficiaries), retail sales*, and the (inverted) unemployment rate. Industrial production remained unchanged in October.

With the 0.3 percent increase in October, the coincident index now stands at 115.6 (1990=100). Based on revised data, this index was unchanged in September and decreased 0.1 percent in August. During the six-month span through October, the index increased 0.7 percent, with three of the four components increasing (diffusion index, six-month span equals 75.0 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. December 16, 2004. 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.


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