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The Conference Board Leading Economic Index®(LEI) for the US dropped 4.4 percent in April, following a decline of 7.4 percent in March. The decline marks the end of more than 11 years of economic expansion and clearly indicates the US economy is now in deep recession territory. This downturn differs from previous recessions—the bursting of the tech bubble in 2001 and the Great Recession of 2008–2009. This time, there were few indications of a potential downturn, but once the shock of the pandemic hit, the drop was much sharper. The underlying components of the index show spotty improvements in financial markets in April. However, the widespread damage to labor markets and industrial activity suggests the imminent reopening of some sectors won’t be enough to generate a fast rebound for the economy at large.
Note: The LEI is a composite average of leading indicators, including working hours, unemployment claims, orders for production, and financial market data. It reveals turning point patterns more accurately because it smooths out the volatility of any individual component.
PRESS RELEASES & iN THE NEWS
April 09, 2021
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