In January, the US Conference Board Leading Economic Index declined by 0.3% to 119.6. This comes after increases in both December (+0.7%) and November (+0.8%) and is the first decline in the index since February 2021.
“Initial claims for unemployment insurance, consumers’ outlook and declines in stock prices, and the average work week in manufacturing all contributed to the decline,” said Ataman Ozyildirim, Senior Director of Economic Research at The Conference Board.
Despite the slight drop in the index, leading indicators suggest continued but slower economic growth in the coming months. “Labor shortages, inflation, and the potential of new COVID-19 variants pose risks to growth in the near term,” Ozyildirim added. “Still, the US economy is projected to expand by a robust 3.5 percent year-over-year in 2022 — well above the pre-pandemic growth rate, which averaged around 2 percent.”
The Coincident Economic Index rose by 0.5% to 107.9 in January, while the Lagging Economic Index jumped 0.7% to reach 110.2. Both indexes had smaller increases in December and November.