The Conference Board CEI for the UK, a measure of current economic activity, remained unchanged in August. Index levels were also revised down in recent months as second quarter data for real household disposable income became available. Between February and August 2010, the coincident economic index increased 1.0 percent (about a 2.0 percent annual rate), a reversal from the decline of 0.3 percent (about a -0.6 percent annual rate) between August 2009 and February 2010. In addition, the strengths among the coincident indicators have remained more widespread than the weaknesses in recent months. At the same time, real GDP increased at a 4.6 percent annual rate in the second quarter, following an increase of 2.1 percent annual rate in the previous quarter.
The Conference Board LEI for the U.K. has been rising since April 2009, though its six-month growth rate has continued to slow. In addition, the strengths among its components were only slightly more widespread than the weaknesses over the past six months. Meanwhile, The Conference Board CEI for the U.K. remained unchanged in August, though it has been generally on an upward trend since February 2010. Taken together, the recent behavior of the composite indexes suggest that economic activity should continue to expand, but at a more modest pace in the near term.
LEADING INDICATORS
Four of the seven components that make up The Conference Board LEI for the U.K. increased in August. The positive contributors – from the largest positive contributor to the smallest – were the yield spread, productivity for the whole economy, order book volume, and stock prices. The negative contributors – from the largest negative contributor to the smallest – were consumer confidence, volume of expected output, and total gross operating surplus of corporations.
With the 0.1 percent increase in August, The Conference Board LEI for the U.K. now stands at 103.2 (2004=100). Based on revised data, this index increased 0.2 percent in July and increased 0.5 percent in June. During the six-month span through August, the leading economic index increased 2.6 percent, with four of the seven components advancing (diffusion index, six-month span equals 57.1 percent).
COINCIDENT INDICATORS
Two of the four components that make up The Conference Board CEI for the U.K. increased in August. The positive contributors – from the largest positive contributor to the smallest – were employment and industrial production. Retail sales declined while real household disposable income remained unchanged in August.
After remaining unchanged in August, The Conference Board CEI for the U.K. now stands at 103.1 (2004=100). Based on revised data, this index increased 0.3 percent in July and increased 0.3 percent in June. During the six-month period through August, the coincident economic index increased 1.0 percent, with three of the four components advancing (diffusion index, six-month span equals 75.0 percent).
