ECRI’s WLI Growth Index which forecasts economic growth six months forward remains in positive territory for the 43rd week – after spending the previous 35 consecutive weeks in negative territory. This is compared to RecessionAlerts similar weekly leading index. ECRI also released their coincident index this week.
Analyst Opinion of the trends of the weekly leading indices
Both ECRI’s and RecessionAlerts indicies are indicating moderate growth six months from today. Both indices are in a growth cycle with both indices improving. Still, they are indicating conditions 6 months from today may be somewhat better than today.
Current ECRI WLI Level and Growth Index:
Here is this week’s update on ECRI’s Weekly Leading Index (note – a positive number indicates growth):
U.S. Weekly Leading Index Rose
The U.S. Weekly Leading Index (WLI) rose to 145.0 from 144.6. The growth rate edged up to 12.0% from 11.9%, a 349-week high, highest since May 7, 2010.
To put the economy in perspective please see links below:
– read Lakshman Achuthan’s recent presentation in Hong Kong on Disentangling Cyclical from Structural.
– read ECRI’s “2016 Shapes 2017 Cyclical Outlook“.
For a closer look at recent moves in the U.S. Weekly Leading Index, see the chart below:
Comparison to RecessionAlert Weekly Indicator
RecessionAlert also produces a weekly foreward indicator using different pulse points tha ECRI’s WLI. Here is a graph from dshort.com which compares the two indices. Both indices are showing nearly the same rate of growth.
Coincident Index:
ECRI produces a monthly coincident index – a positive number shows economic expansion. The December index value (issued in January) shows a small decline in the rate of economic growth.
z ecri_coin.png
ECRI produces a monthly inflation index – a positive number shows increasing inflation pressure.
U.S. Future Inflation Gauge:
z ecri_infl.PNG
U.S. FIG Dips in December
U.S. inflationary pressures were down slightly in December, as the U.S. future inflation gauge declined to 113.0 from a downwardly revised 113.6 reading in November, first reported as 113.8, according to data released Friday morning by the Economic Cycle Research Institute.
“The USFIG slipped in December, while staying near November’s 8½-year high,” ECRI Chief Operations Officer Lakshman Achuthan said in a release. “Thus, underlying inflation pressures continue to be elevated.”
ECRI produces a monthly Lagging index. The November economy’s rate of growth (released in December) showed the rate of growth marginally declined.
U.S. Lagging Index:
z ecri_lag.PNG
source: ECRI
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