China's leading economic index remains unchanged in July 2024: TCB

The leading economic index (LEI) for China remained unchanged in July 2024, holding steady at 150, following a slight decline of 0.3 per cent in June, according to The Conference Board (TCB). The LEI, a key indicator of future economic activity, has seen a decline of 1.4 per cent over the six-month period from January to July 2024, continuing the downward trend from the previous six-month period, where it fell by 1.6 per cent from July 2023 to January 2024.

In contrast, the coincident economic index (CEI) for China, which measures current economic activity, showed a modest improvement in July 2024. The CEI rose by 0.4 per cent to 148.6, following a more significant increase of 1.0 per cent in June. However, the growth rate of the CEI over the six-month period from January to July 2024 was 1.2 per cent, which is less than half the 2.9 per cent growth rate observed in the previous six-month period, as per TCB.

“The China LEI was flat in July,” said Ian Hu, economic research associate, TCB. “Persistently depressed consumer expectations, alongside a soft logistics prosperity index, low floor space started, and a weak manufacturing PMI, continued to weigh on the Leading Index which has been trending down for over two years. The six- and twelve-month changes to the LEI remained negative and pointed to continuing headwind to growth, though the index has recently moved out of the recession signal territory.”

ALCHEMPro News Desk (DP)