November Leading Economic Indicators Unchanged, But Point to 2017 Growth

The Conference Board, New York, said its Leading Economic Index was unchanged in November, at 124.6, following an 0.1 percent increase in October and an 0.3 percent increase in September.

The Coincident Economic Index increased by 0.1 percent in November to 114.6, following an 0.2 percent increase in October and an 0.2 percent increase in September. The Lagging Economic Index increased by 0.3 percent in November to 123.2, following an 0.2 percent increase in October and an 0.2 percent increase in September.

Tim Quinlan, economist with Wells Fargo Securities, Charlotte, N.C., said “pronounced weakness” in building permits and manufacturing hours worked held the index down.

“Leading the decliners were building permits and manufacturing hours worked, which exerted negative contributions to the index,” Quinlan said. Strength in the interest rate spread, which boosted the index by 0.19 percentage points (its highest reading since January of this year), helped offset the contractionary components. Appreciation of stock prices also helped the index stay out of the red.”

Ataman Ozyildirim, Director of Business Cycles and Growth Research with The Conference Board, sounded a more hopeful analysis. “Underlying trends in the LEI suggest that the economy will continue expanding into the first half of 2017, but it’s unlikely to considerably accelerate,” he said.