The Conference Board CEI for the U.K., a measure of current economic activity, increased for a second consecutive month in April. During the past six months, the coincident economic index decreased by 0.4 percent (about a -0.8 percent annual rate), after remaining unchanged during the previous six months. Additionally, the strengths and weaknesses among the coincident indicators have remained balanced in recent months. Meanwhile, real GDP contracted at a 7.4 percent annual rate during the first quarter of 2009, its largest quarterly decline since 1979, following a decline of 5.9 percent annual rate in the fourth quarter of 2008.
Though The Conference Board LEI for the U.K. has been trending downward since its peak in June 2007, the pace of this decline has moderated significantly in recent months. The Conference Board CEI for the U.K. has declined slightly since December 2008, after remaining essentially flat during the second half of last year. Taken together, the recent behavior of the composite economic indexes suggests that the contraction in economic activity should continue in the near term but will likely become less deep in the months ahead.
LEADING INDICATORS
Six of the seven components that make up The Conference Board LEI for the U.K. increased in April. The positive contributors – from the largest positive contributor to the smallest – were consumer confidence, stock prices, yield spread, volume of expected output, productivity for the whole economy and operating surplus of corporations. The only negative contributor was order book volume.
With the 0.9 percent increase in April, The Conference Board LEI for the U.K. now stands at 92.2 (2004=100). Based on revised data, this index declined 0.5 percent in March and declined 0.6 percent in February. During the six-month span through April, the leading economic index decreased 3.0 percent, with two of the seven components advancing (diffusion index, six-month span equals 28.6 percent).
COINCIDENT INDICATORS
All four components that make up The Conference Board CEI for the U.K. increased in April. The positive contributors – from the largest positive contributor to the smallest – were retail sales, real household disposable income, employment and industrial production.
With the increase of 0.1 percent in April, The Conference Board CEI for the U.K. now stands at 103.7 (2004=100). Based on revised data, this index increased 0.1 percent in March and decreased 0.3 percent in February. During the six-month period through April, the coincident economic index decreased 0.4 percent, with two of the four components advancing (diffusion index, six-month span equals 50.0 percent).
