UK economy to grow moderately in H2 2024; annual growth to hit 1%: TCB

The US think tank’s leading economic index (LEI) for the country remained unchanged in August this year at 75.2, following a 0.3-per cent decline in July. The UK LEI contracted by 0.9 per cent over the six-month period between February and August 2024, after contracting by 1.4 per cent over the previous six-month period. 

The think tank’s UK coincident economic index (CEI) rose by 0.2 per cent in August to 105.6, following another increase of 0.2 per cent in July. Overall, the CEI for the UK grew by 1.1 per cent over the six-month period between February and August 2024, a much higher rate than the 0.1 per cent increase over the previous six-month period between August 2023 and February 2024.

The LEI provides an early indication of significant turning points in the business cycle and where the economy is heading in the near term, whereas the CEI offers an indication of the current state of the economy.

“The UK LEI held steady in August following a series of successive declines over the previous six months,” said Allen Li, associate economist at The Conference Board.

“As in previous months, the weakness was driven by the negative yield spread, in addition to labour market components, like unemployment claims and working hours. However, for the third month in a row, consumers’ assessment of economic conditions and housing sales expectations improved after having weighed on the Index for much of the past two and a half years," he said.

"The LEI’s annual growth rate, though still negative, has improved substantially since the beginning of the year, indicating still that headwinds to growth may be lessening,” he added.

ALCHEMPro News Desk (DS)