The Conference Board US Leading Economic Index Continues to Decline in April

The Conference Board, a non-partisan, not-for-profit think tank founded in 1916, released on Friday its US Leadings Indicators for April.

• The Leading Economic Index® (LEI) decreased by 0.6% to a reading of 101.8 (2016=100), following a 0.3% decrease in March. The LEI has contracted 1.9% over the six-month period from October 2023 to April 2024, a smaller decrease than the 3.5% contraction over the previous six-months period.
• The Coincident Economic Index® (CEI) rose 0.2% to a reading of 112.3 (2016=100), after a similar 0.2% increase in March. The CEI is now up 0.9% over the six-period ending in April, slightly ahead of its 0.8% increase over the previous six-month period. The CEI’s component indicators—payroll employment, personal income less transfer payments, manufacturing trade and sales, and industrial production—are included among the data used to determine recessions in the US. In April, all four components advanced, with personal income less transfer payments providing the strongest contribution to the Index.
• The Lagging Economic Index® (LAG) increased 0.4% to a reading of 119.5 (2016=100), after remaining unchanged in March. The LAG has increased 1.1% over the six-month period ending in April, after recording a substantial improvement of 0.3 over the previous six months.

Adding background and analysis to the report, Senior Manager, Business Cycle Indicators at the Conference Board, Justyna Zabinska-La Monica, said:

“Another decline in the US LEI confirms that softer economic conditions lay ahead. Deterioration in consumers’ outlook on business conditions, weaker new orders, a negative yield spread, and a drop in new building permits fueled April’s decline. In addition, stock prices contributed negatively for the first time since October of last year. While the LEI’s six-month and annual growth rates no longer signal a forthcoming recession, they still point to serious headwinds to growth ahead. Indeed, elevated inflation, high interest rates, rising household debt, and depleted pandemic savings are all expected to continue weighing on the US economy in 2024. As a result, we project that real GDP growth will slow to under 1 percent over the Q2 to Q3 period.”