The Conference Board CEI for the U.K., a measure of current economic activity, increased in November for the fifth time in the last six months. Between May and November 2009, the coincident economic index increased by 0.6 percent (about a 1.2 percent annual rate), after falling by 1.1 percent (about a -2.1 percent annual rate) between November 2008 and May 2009. Additionally, the strengths among the coincident indicators have become more widespread. Meanwhile, real GDP contracted at a 0.8 percent annual rate during the third quarter of 2009, following a decline of 2.7 percent annual rate during the second quarter.
After falling steadily between the middle of 2007 and the first quarter of 2009, The Conference Board LEI for the U.K. has risen sharply during the past eight months. Its six-month growth rate remains near its highest rate since 1978. Meanwhile, The Conference Board CEI for the U.K. has been mostly rising since June. Taken together, the recent behavior of the composite indexes suggests that the downturn in economic activity is bottoming out and that economic conditions will continue to improve in the months ahead.
LEADING INDICATORS
All of the components that make up The Conference Board LEI for the U.K. increased in November. The positive contributors – from the largest positive contributor to the smallest – were the yield spread, consumer confidence, order book volume, volume of expected output, productivity for the whole economy, stock prices and total gross operating surplus of corporations.
With the 0.9 percent increase in November, The Conference Board LEI for the U.K. now stands at 98.6 (2004=100). Based on revised data, this index increased 1.1 percent in October and increased 1.0 percent in September. During the six-month span through November, the leading economic index increased 6.3 percent, with all seven components advancing (diffusion index, six-month span equals 100.0 percent).
COINCIDENT INDICATORS
Three of the four components that make up The Conference Board CEI for the U.K. increased in November. The positive contributors - from the largest positive contributor to the smallest – were real household disposable income, employment and industrial production. Retail sales declined in November.
With the increase of 0.1 percent in November, The Conference Board CEI for the U.K. now stands at 102.8 (2004=100). Based on revised data, this index increased 0.1 percent in October and increased 0.1 percent in September. During the six-month period through November, the coincident economic index increased 0.6 percent, with three of the four components advancing (diffusion index, six-month span equals 75.0 percent).
