Economic barometer signals US recession in near future

“The US LEI fell sharply again in December—continuing to signal recession for the US economy in the near term,” said Ataman Ozyildirim, senior director, economics, at The Conference Board.

“There was widespread weakness among leading indicators in December, indicating deteriorating conditions for labor markets, manufacturing, housing construction, and financial markets in the months ahead. Meanwhile, the coincident economic index (CEI) has not weakened in the same fashion as the LEI because labour market-related indicators (employment and personal income) remain robust,” he said.

“Nonetheless, industrial production—also a component of the CEI—fell for the third straight month. Overall economic activity is likely to turn negative in the coming quarters before picking up again in the final quarter of 2023,” he added in a press release.

The Conference Board CEI for the country increased by 0.1 per cent in December last year to 109.6 (2016=100) after no change in November. The CEI rose by 1.4 per cent over the six-month period from June to December 2022, faster than its growth of 0.4 per cent over the previous six months.

The Conference Board lagging economic index (LAG) for the country increased by 0.3 per cent in December 2022 to 117.6 (2016 = 100), following an increase of 0.2 per cent in November. The LAG is up by 2.3 per cent over the six-month period from June to December 2022, much slower than its growth of 4.5 per cent over the previous six months.

The Conference Board is the member-driven, non-partisan, not-for-profit think tank.

ALCHEMPro News Desk (DS)