The Conference Board’s leading indicator rose by 0.6 per cent month-on-month in July, beating expectations. This follows no change in June and a 0.3 per cent increase in May. Analysts had expected to see an increase of 0.5 per cent (release).
The leading indicator measures future trends of overall economic activity, taking into account employment, initial jobless claims, housing permits, stock prices and bond yields. It is considered as a measure for economic stability in the US.
Ataman Ozyildirim, an economist at the Conference Board, said:
Following moderate growth in the last few months, the U.S. LEI picked up in July, with widespread gains among its components. The pace of the LEI’s growth over the last six months has nearly doubled, pointing to a gradually strengthening expansion through the end of the year. In July, average workweek in manufacturing was the weakest component.
Colleague Ken Goldstein added:
The improvement in the LEI, and pick up in the six-month growth rate, suggest better economic and job growth in the second half of 2013. However, the biggest uncertainties remain the pace of business spending and the impact of slower global growth on U.S. exports.