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Last Update: 22-Dec-11 10:48 ET
Leading Indicators Continue to Show an Expanding Economy
The Conference Board's Leading Economic Indicators Index increased 0.5% in November after increasing 0.9% in October. The Briefing.com consensus expected the index to increase by 0.3%.
Since seven of the 10 components are known prior to the release, the difference between the consensus and the actual data normally comes from the three estimated components: manufacturing orders of consumer goods, manufacturing orders of business capital, and M2 money supply.
In this case, however, the actual data on building permits were released after economists made their leading indicators prediction. The timing problem caused economists to rely on their building permits forecast when calculating the leading indicators prediction.
Building permits growth was stronger than the consensus expected (+5.7% vs. -3.1%) and contributed 0.15 percentage points to the leading indicators. That was exactly the difference between the consensus leading indicators forecast and the actual release.
Since seven of the 10 components are known prior to the release, the difference between the consensus and the actual data normally comes from the three estimated components: manufacturing orders of consumer goods, manufacturing orders of business capital, and M2 money supply.
In this case, however, the actual data on building permits were released after economists made their leading indicators prediction. The timing problem caused economists to rely on their building permits forecast when calculating the leading indicators prediction.
Building permits growth was stronger than the consensus expected (+5.7% vs. -3.1%) and contributed 0.15 percentage points to the leading indicators. That was exactly the difference between the consensus leading indicators forecast and the actual release.
