Leading Economic Index reflects slow growth

The Conference Board’s Leading Economic Index continues to suggest that slow growth is the most likely course for the recovery.  The index designed to forecast future trends rose 0.3% in September, which follows a 0.1% increase in August, and a 0.2% increase in July.






















“The LEI remains on a general upward trend, but it is growing at its slowest pace since the middle of 2009. There isn’t any indication of a relapse into another downturn through the end of the year, according to Ataman Ozyildirim, an economist with the Conference Board.

Ken Goldstein, economist at The Conference Board, said, “More than a year after the recession officially ended, the economy is slow and has no forward momentum. The LEI suggests little change in economic conditions through the holidays or the early months of 2011.”

Though the Leading Index is pointing to further gains in economic activity, the largest positive contributor, interest rate spread, and the third largest contributor, real money supply, come more under the heading of intangibles.

Notably, the Coincident Economic Index held steady for the second-straight month after a 0.1% rise in July, which is a reflection of the slowdown over the summer. The Coincident Index, which measures current economic conditions, hit a bottom in June 2009, the month the recession ended.