The Conference Board Leading Economic Index® (LEI) for Australia Declined

WASHINGTON, D.C. – June 23, 2015 – (RealEstateRama) — The Conference Board Leading Economic Index® (LEI) for Australia declined 0.3 percent and The Conference Board Coincident Economic Index® (CEI) increased 0.1 percent in April.

• The Conference Board LEI for Australia declined in April, primarily due to a large decline in building approvals. Between October 2014 and April 2015, the leading economic index increased 1.8 percent (about a 3.5 percent annual rate), a reversal from its contraction of 1.0 percent (about a ?1.9 percent annual rate) over the previous six months. The strengths among the leading indicators have remained more widespread than the weaknesses in recent months.
• The Conference Board CEI for Australia, a measure of current economic activity, improved marginally in April. The coincident economic index increased 1.4 percent (about a 2.8 percent annual rate) in the six-month period ending April 2015, up from 0.8 percent (about a 1.5 percent annual rate) over the previous six months. Meanwhile, real GDP grew 3.8 percent (annual rate) in the first quarter of 2015, up from 1.9 percent (annual rate) in the final quarter of 2014.
• The Conference Board LEI for Australia declined slightly in April, but the strengths among its components remain very widespread. As a result, the six-month growth rate of the LEI has improved considerably compared to six months ago. Meanwhile, the CEI for Australia continues to increase, and its six-month growth rate has also improved over the same time span. Taken together, the recent behavior of the composite indexes suggests that the current economic expansion should continue in the near term.

LEADING INDICATORS. Four of the seven components that make up The Conference Board LEI for Australia increased in April. The positive contributors to the index—in order from the largest positive contributor to the smallest—were sales to inventories ratio*, money supply*, gross operating surplus*, and the yield spread. Building approvals, share prices, and rural goods exports declined in April.

With the 0.3 percent decrease in April, The Conference Board LEI for Australia now stands at 104.6 (2010=100). Based on revised data, this index remained unchanged in March and increased 0.7 percent in February. During the six-month period through April, the leading economic index increased 1.8 percent, and all seven components increased (diffusion index, six-month span equals 100.0 percent).

COINCIDENT INDICATORS. Three of the four components that make up The Conference Board CEI for Australia increased in April. The positive contributors to the index—in order from the largest positive contributor to the smallest—were household gross disposable income*, retail trade, and industrial production*. Employed persons declined in April.

With the increase of 0.1 percent in April, The Conference Board CEI for Australia now stands at 108.2 (2010=100). Based on revised data, this index increased 0.3 percent in March and increased 0.4 percent in February. During the six-month period through April, the coincident economic index increased 1.4 percent, with all four components in the series advancing (diffusion index, six-month span equals 100.0 percent).

DATA AVAILABILITY. The data series used to compute The Conference Board Leading Economic Index® (LEI) for Australia and The Conference Board Coincident Economic Index® (CEI) for Australia reported in this release are those available “as of” 10 A.M. ET on June 19, 2015. Some series are estimated as noted below.

Series in The Conference Board LEI for Australia that are based on our estimates are sales to inventory ratio and gross operating surplus for private non-financial corporations, the implicit price index used to deflate rural goods exports and building approvals, and the CPI used to deflate money supply M3. Series in The Conference Board CEI for Australia that are based on our estimates are industrial production and household disposable income. CPI was used to deflate retail trade.

The next release is scheduled for Friday, July 17 at 10:00 A.M. (AEST); Thursday, July 16 at 8:00 P.M. (EST).