Conference Board Leading Economic Index: Continued Increases in July, Another All-Time High

The latest Conference Board Leading Economic Index (LEI) for July increased to 128.3 from a revised 127.9 in June and is currently at another all-time high. The 0.3 percent month-over-month gain matched the 0.3% increase forecast by

The Conference Board LEI for the U.S. continued to increase through July with gains widespread across nearly all of its components, except for building permits, which contributed negatively. In the six-month period ending July 2017, the leading economic index increased 2.3 percent (about a 4.7 percent annual rate), faster than the growth of 1.5 percent (about a 3.1 percent annual rate) during the previous six months. In addition, the strengths among the leading indicators have remained widespread. [Full notes in PDF]

Here is a log-scale chart of the LEI series with documented recessions as identified by the NBER. The use of a log scale gives us a better sense of the relative sizes of peaks and troughs than a more conventional linear scale.

Conference Board's LEI

For additional perspective on this indicator, see the latest press release, which includes this overview:

“The U.S. LEI improved in July, suggesting the U.S. economy may experience further improvements in economic activity in the second half of the year,” said Ataman Ozyildirim, Director of Business Cycles and Growth Research at The Conference Board. “The large negative contribution from housing permits, a reversal from June, was more than offset by gains in the financial indicators, new orders and sentiment.”

For a better understanding of the relationship between the LEI and recessions, the next chart shows the percentage-off the previous peak for the index and the number of months between the previous peak and official recessions.

LEI from Peak