The Conference Board CEI for the U.K., a measure of current economic activity, increased slightly in June after falling for the previous seven months. Between December 2008 and June 2009, the coincident economic index decreased by 1.5 percent (about a -3.1 percent annual rate), faster than the 0.2 percent decrease (about a -0.4 percent annual rate) for the previous six months. In addition, the weaknesses among the coincident indicators have remained widespread in recent months. Meanwhile, real GDP contracted at a 3.1 percent annual rate during the second quarter of 2009, following a decline of 9.2 percent annual rate in the first quarter.
After falling steadily from the middle of 2007 through the first quarter of 2009, The Conference Board LEI for the U.K. has risen during the second quarter. As a result, the pace of its six-month contraction has slowed substantially in recent months. The Conference Board CEI for the U.K. has declined rapidly since December 2008, though it increased slightly this month. Taken together, the recent behavior of the composite indexes suggests that the pace of contraction in economic activity should continue to moderate in the months ahead.
LEADING INDICATORS.
Four of the seven components that make up The Conference Board LEI for the U.K. increased in June. The positive contributors – from the largest positive contributor to the smallest – were volume of expected output, consumer confidence, yield spread, and order book volume. The negative contributors – from the largest negative contributor to the smallest – were productivity for the whole economy, stock prices and operating surplus of corporations.
With the 1.0 percent increase in June, The Conference Board LEI for the U.K. now stands at 92.3 (2004=100). Based on revised data, this index increased 1.0 percent in May and increased 0.7 percent in April. During the six-month span through June, the leading economic index decreased 0.4 percent, with four of the seven components advancing (diffusion index, six-month span equals 57.1 percent).
COINCIDENT INDICATORS.
Three of the four components that make up The Conference Board CEI for the U.K. increased in June. The positive contributors – from the largest positive contributor to the smallest – were retail sales, industrial production and real household disposable income. Employment declined in June.
With the increase of 0.1 percent in June, The Conference Board CEI for the U.K. now stands at 102.3 (2004=100). Based on revised data, this index decreased 0.2 percent in May and decreased 0.2 percent in April. During the six-month period through June, the coincident economic index decreased 1.5 percent, with one of the four components advancing (diffusion index, six-month span equals 25.0 percent).
