Bucking all other leading indicators, the Conference Board’s Leading Economic Indicator for May 2011 rose indicating the future will be better than today.
The Conference Board Leading Economic Index® (LEI) for the U.S. increased 0.8 percent in May to 114.7 (2004 = 100), following a 0.4 percent decline in April, and a 0.7 percent increase in March. The largest contributions came from the interest rate spread, consumer expectations, and housing permits.
Says Ataman Ozyildirim, economist at The Conference Board: “The U.S. LEI rebounded in May and resumed its upward trend with a majority of the components supporting this gain. The Coincident Economic Index, a monthly measure of current economic conditions, continued to increase slowly but steadily. Overall, despite short-term volatility, the composite indexes still point to expanding economic activity in the coming months.”
Says Ken Goldstein, economist at The Conference Board: “Modest economic growth is being buffeted by some strong headwinds, including high gas and food prices and a soft housing market. The economy will likely continue to grow through the summer and fall, however it will be choppy.”
The Conference Board Coincident Economic Index® (CEI) for the U.S. increased 0.1 percent in May to 102.9 (2004 = 100), following a 0.1 percent increase in April, and a 0.2 percent increase in March.
Even the Conference Board’s coincident indicator continues to rise despite much less good data.
This index is based to a large extent on monetary measures which have been extraordinarily stimulative with interest rates set at artificially low levels by the Federal Reserve. For this reason, the hyper-values produced by this index are not necessarily linked to any real economic dynamics.
Econintersect has forecast an economic peak in April (analysis here), and its indicator is falling.
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