The Conference Board Reports US Leading Economic Index® Declined for 6th Consecutive Month in August

The Conference Board, a non-partisan, not-for-profit think tank founded in 1916, released today (9-22-22) its Leading Economic Index® (LEI) for the US in August 2022. According to the report, the LEI declined 0.3% in August to a reading of 116.2 (2016 = 100), following declines of 0.5% in July and 0.7% in June. The LEI has dropped 2.7% over the six-month period from February to August 2022—a reversal from its 1.7% growth over the previous six-month time period.

The Conference Board Coincident Economic Index® (CEI) for the US increased by 0.1% in August to a reading of 108.7 (2016=100), following a 0.5% increase in July and a 0.1% increase in June. The CEI has increased by 0.6% over the six-month period from February to August 2022, slower than its growth of 1.5% over the previous six-month period.

The Conference Board Lagging Economic Index® (LAG) for the US increased by 0.7% in August to a reading of 115.4 (2016=100), following a 0.4% increase in July and a 0.7% increase in June. The LAG has increased by 4.4% over the six-month period from February to August 2022—faster than the 2.5% growth it experienced during the previous six-month period.

Adding additional background and analysis, Senior Director of Economic Research at the Conference Board Ataman Ozyildirim said:

“The US LEI declined for a sixth consecutive month, potentially signaling a recession. Among the index’s components, only initial unemployment claims and the yield spread contributed positively over the last six months—and the contribution of the yield spread has narrowed recently.

Furthermore, labor market strength is expected to continue moderating in the months ahead. Indeed, the average workweek in manufacturing contracted in four of the last six months—a notable sign, as firms reduce hours before reducing their workforce. Economic activity will continue slowing more broadly throughout the US economy and is likely to contract. A major driver of this slowdown has been the Federal Reserve’s rapid tightening of monetary policy to counter inflationary pressures. The Conference Board projects a recession in the coming quarters.”