The Conference Board’s Leading Economic Index (LEI) was updated Monday, rising for the third straight month. The LEI increased 0.8 percent in March to 100.9, outpacing increases of 0.2 percent in January and 0.5 percent in February.
Ten factors are associated with the score, including average weekly hours, manufacturing, average weekly initial claims for unemployment insurance, building permits, new private housing units, and average consumer expectations for business conditions. The group provides composite averages based on the indicators to reveal turning point patterns in economic data rather than relying on volatile independent component data.
“After a winter pause, the leading indicators are gaining momentum and economic growth is gaining traction. While the improvements were broad-based, labor market indicators and the interest rate spread largely drove the March increase, offsetting the negative contribution from building permits. And, for the first time in many months, the consumer outlook is much less negative,” said Ataman Ozyildirim, economist at the Conference Board.
The outlook in the analytic system points more to a peak than a trough in coming months. “The March increase in the LEI suggests accelerated growth for the remainder of the spring and the summer,” added Ken Goldstein, economist at the Conference Board. “The economy is rebounding from widespread inclement weather and the strengthening in the labor market is beginning to have a positive impact on growth.
“Overall, this is an optimistic report, but the focus will continue to be on whether improvements in the labor market can be sustained, fueling stronger economic performance over the next few months,” he continued.
Another two indexes were also updated: the Conference Board Coincident Economic Index (CEI) for the U.S. increased 0.2 percent in March to 108.3 following a 0.4 percent increase in February and a 0.1 percent decline in January.
Also, the Conference Board Lagging Economic Index (LAG) for the U.S. increased 0.6 percent in March to 123.0 following a 0.3 percent increase in February and a 0.6 percent increase in January.