Leading Economic Index Fell 1.3% Over 2nd Half of 2024 - Modern Distribution Management

Leading Economic Index Fell 1.3% Over 2nd Half of 2024

The Conference Board's LEI six-month and 12-month growth rates were less negative than earlier in 2024, while the CEI pointed to positive current economic growth despite a December downtick.
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The Conference Board reported its December 2024 Leading Economic Index (LEI) and the Coincident Economic Index (CEI) — seen as an early indication of significant turning points in the business cycle and the direction the economy is heading, respectively — on Jan. 22.

The December 2024 LEI for the U.S. fell by 0.1% to 101.6, following a upwardly revised increase of 0.4% in November, according to the latest index published by The Conference Board.

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The LEI fell by 1.3% over the six-month period ending in December 2024, a smaller rate than the six-month period over the first half of thr year (-1.7%).

“The Index fell slightly in December failing to sustain November’s increase,” The Conference Board Senior Manager of Business Cycle Indicators Justyna Zabinska-La Monica said in the report. “Low consumer confidence about future business conditions, still relatively weak manufacturing orders, an increase in initial claims for unemployment, and a decline in building permits contributed to the decline. Still, half of the 10 components of the index contributed positively in December. Moreover, the LEI’s six-month and 12-month growth rates were less negative, signaling fewer headwinds to US economic activity ahead. Nonetheless, we expect growth momentum to remain strong to start the year and US real GDP to expand by 2.3% in 2025.”

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The December 2024 CEI for the U.S. increased by 0.4% to 114.1, following a 0.2% increase in November.

In the six-month period ending December 2024, the CEI grew by 0.9%, slightly faster than its 0.7% growth rate over the previous six months. The component indicators of the CEI — payroll employment, personal income less transfer payment, manufacturing and trade sales and industrial production — improved in December. The largest positive contribution can from industrial production — down three of the last six months.

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In addition to reporting its LEI and CEI, the Conference Board posted the Lagging Economic Index (LAG) for the U.S. which increased by 0.1% to 118.5 in December, following a 0.2% increase in November. Over the six-month period growth rate remained negative (-0.5%) over the second half of 2024, which was a partial reversal from its 0.8% increase in the first half of 2024.

The LEI Pulled Back Slightly in December 2024 after November’s Upwardly Revised Gain

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