Leading Economic Indicators Up in April

The Conference Board, New York said its Leading Economic Index increased by 0.3 percent in April, the eighth consecutive monthly gain.

The LEI rose to 126.9 in April, following an 0.3 percent increase in March and a 0.5 percent increase in February. The Coincident Economic Index increased by 0.3 percent in April to 115.2, following an 0.3 percent increase in March and an 0.1 percent increase in February. The Lagging Economic Index increased by 0.3 percent in April to 124.1, following an 0.1 percent increase in March and an 0.2 percent increase in February.

“The recent trend in the U.S. LEI, led by the positive outlook of consumers and financial markets, continues to point to a growing economy, perhaps even a cyclical pickup,” said Ataman Ozyildirim, Director of Business Cycles and Growth Research with The Conference Board. “First quarter’s weak GDP growth is likely a temporary hiccup as the economy returns to its long-term trend of about 2 percent. While the majority of leading indicators have been contributing positively in recent months, housing permits followed by average workweek in manufacturing have been the sources of weakness among the U.S. LEI components.”

Tim Quinlan, senior economist with Wells Fargo Securities, Charlotte, N.C., said strength in the interest rate spread and initial jobless claims components helped boost the index.

“The interest rate spread component was, once again, the largest contributor to the index in April, adding 0.16 percentage points,” Quinlan said. “Building permits was April’s largest detractor, slicing 0.07 percentage points off the headline number.”