The Conference Board CEI for Germany, a measure of current economic activity, increased for the third consecutive month in July, led by a strong positive contribution from industrial production. Between January and July 2011, the coincident economic index increased 1.1 percent (about a 2.3 percent annual rate), slightly slower than the growth of 1.3 percent (about a 2.7 percent annual rate) that prevailed during the previous six months. In addition, the strengths among the coincident indicators have been very widespread, with all components increasing over the past six months. Meanwhile, real GDP increased at a 0.5 percent annual rate in the second quarter of 2011, after growth of 5.5 percent annual rate in the first quarter.
The Conference Board LEI for Germany decreased for the second consecutive month in July, amid widespread weaknesses among its components. As a result, the leading economic index is now slightly below its most recent peak in July 2007. Meanwhile, the growth trend in current economic conditions, as measured by The Conference Board CEI for Germany, has remained relatively stable this year. Taken together, the recent behavior of the composite indexes suggests that the economy should continue to expand in the near term, though perhaps at a modest pace.
LEADING INDICATORS
Three of the seven components in The Conference Board LEI for Germany increased in July. The positive contributors — in order from the largest positive contributor to the smallest - were the yield spread, stock prices, and inventory change. The negative contributors — in order from largest to smallest — were new residential construction orders, consumer confidence, gross enterprises and properties income and new orders in investment goods industries.
With the 0.3 percent decrease in July, The Conference Board LEI for Germany now stands at 109.0 (2004=100). Based on revised data, this index decreased 0.2 percent in June and increased 0.5 percent in May. During the six-month span through July, the index increased 1.3 percent, with three of the seven components increasing (diffusion index, six-month span equals 42.9 percent).
COINCIDENT INDICATORS
Three of the four components that make up The Conference Board CEI for Germany increased in July. The positive contributors - in order from the largest positive contributor to the smallest - were industrial production, employed persons and retail trade. Manufacturing sales declined in July.
With the 0.4 percent increase in July, The Conference Board CEI for Germany now stands at 106.8 (2004=100). Based on revised data, this index increased 0.2 percent in June and increased 0.2 percent in May. During the six-month period through July, the index increased 1.1 percent, with all four components increasing (diffusion index, six-month span equals 100.0 percent).
