The Conference Board CEI for the Euro Area, a measure of current economic activity, remained unchanged in April after increasing slightly in March, according to preliminary estimates. Between October 2009 and April 2010, the coincident economic index increased by 0.4 percent (about a 0.8 percent annual rate), a reversal from the 0.3 percent decline (about a -0.6 percent annual rate) during the previous six months. Additionally, the strengths and weaknesses among the coincident indicators have been balanced in recent months. At the same time, real GDP grew at a 0.8 percent annual rate during the first quarter of 2010, following an increase of 0.2 percent annual rate in the previous quarter.
The Conference Board LEI for the Euro Area has been growing for more than a year and the index is now just 1.4 percent below its high reached in 2007. Though its six-month rate of increase has slowed from the rapid pace in the second half of 2009, this rate has picked up during the past two months. Meanwhile, The Conference Board CEI for the Euro Area has increased modestly since October 2009. Taken together, the recent behavior of the composite indexes suggests that the moderate improvement in economic activity should continue in the near term.
LEADING INDICATORS
Six of the eight components in The Conference Board LEI for the Euro Area increased in April. The positive contributors - in order from the largest positive contributor to the smallest - are the interest rate spread, the Economic Sentiment Index, the Markit Purchasing Managers' Index (manufacturing), the EURO STOXX® Index, the Markit business expectations index (services) and real money supply. Negative contributors - in order from largest to smallest - are new orders of capital goods and residential building permits.
With the 0.9 percent increase in April, The Conference Board LEI for the Euro Area now stands at 110.4 (2004=100). Based on revised data, this index increased 1.2 percent in March and increased 0.5 percent in February. During the six-month span through April, the index increased 5.0 percent, with six of the eight components increasing (diffusion index, six-month span equals 75.0 percent).
COINCIDENT INDICATORS
Two of the four components that make up The Conference Board CEI for the Euro Area increased in April. The positive contributors were retail trade and industrial production. Employment and manufacturing turnover declined in April.
After remaining unchanged in April, The Conference Board CEI for the Euro Area now stands at 102.0 (2004=100). Based on revised data, this index increased 0.1 percent in March and remained unchanged in February. During the six-month period through April, the index increased 0.4 percent, with two of the four components increasing (diffusion index, six-month span equals 50.0 percent).
