The Conference Board US Leading Economic Index Declines in September

On Wednesday, The Conference Board released its US Leading Indicators for September.

• The Leading Economic Index (LEI) declined 0.3% in September to 98.3 (2016=100), following a 0.3% drop in August that was upwardly revised from an initially reported 0.5% decline. The index fell 2.1% between March and September, compared with a 1.3% contraction over the prior six-month period. Due to a lag in publication of the Census Bureau’s September building permits data, The Conference Board said the series was estimated via statistical imputation using an autoregressive model.
• The Coincident Economic Index (CEI) rose 0.1% to 115.1 in September, after holding steady in August following a downward revision from a previously reported 0.2% increase. Over the latest six-month period, the CEI rose 0.3%, compared with a 1.1% gain over the prior six months. Its four components—payroll employment, personal income less transfer payments, manufacturing and trade sales, and industrial production—are included among the data used to determine recessions in the US. In September, payroll employment, personal income less transfer payments, and industrial production improved, while manufacturing and trade sales (estimated for August and September), also contributed positively.
• The Lagging Economic Index (LAG) edged up 0.1% to 119.6 in September, matching August’s increase. Over the six-month period ending in September, the LAG rose 0.5%, slightly below the 0.6% gain recorded in the prior six months.

Commenting on the report, Justyna Zabinska-La Monica, senior manager for business cycle indicators at The Conference Board, said:

“The US LEI fell again in September, marking a second consecutive decline. Weakening expectations from consumers and businesses led the overall contraction in the Index. Subindexes that contributed negatively to the LEI were consumer expectations and ISM New Orders Index, followed by manufacturers’ new orders of consumer goods and materials, initial claims for unemployment insurance (inverted), and the yield curve. However, stock prices, the Leading Credit Index, and manufacturers’ new orders of nondefense capital goods excluding aircraft did contribute positively to the Index. The LEI suggests slowing economic activity at the end of 2025 and into early 2026, with GDP weakening after strong mid-year consumer spending and Q4 disruptions amid the federal government shutdown. Overall, growth remains fragile and uneven as businesses adjust to tariff changes and softer consumer momentum. The Conference Board expects GDP to expand by 1.8% in 2025, before falling to 1.5% in 2026.”