Tuesday, February 20, 2007

Leading indicators

The growth of the composite leading index returned to 0.5% in January, after a brief slowdown to 0.2% in December. Most of the acceleration originated in housing, where balmy weather early in the new year gave a boost to housing starts. Financial market conditions remained buoyant, while most other components posted slow, steady growth.

The housing index swung from a 0.5% decline in December to a 2.8% increase in January. All of the turnaround originated in housing starts, where the stimulus of mild weather did not last past the second week of January. Durable goods sales posted an increase of 0.4%, probably a better representation of the underlying trend in consumer spending.

The stock market also bolstered household wealth, hitting a new high in January. Growth shifted from metals and energy to sectors more dependent on domestic demand.

The leading indicator for the United States rose 0.1%, after a downward-revised 0.1% drop the month before. The gradual improvement in the outlook for our largest export market was reflected in an upturn in new orders from manufactured goods. Still, manufacturers struggled to keep inventories aligned with shipments, and continued to trim the workweek of employees.

Available on CANSIM: table 377-0003.

Definitions, data sources and methods: survey number 1601.

A more detailed analysis of the components is available online. For more information on the economy, consult the February 2007 issue of Canadian Economic Observer, Vol. 20, no. 2 (11-010-XWB, free), now available from the Publications module of our website. A printed version (11-010-XPB, $25/$243) is also available.

For more information, or to enquire about the concepts, methods or data quality of this release, contact Philip Cross (613-951-9162; ceo@statcan.ca), Current Economic Analysis Group.

Leading indicators
	August 2006	September 2006	October 2006	November 2006	December 2006	January 2007	Last month of data available
							% change
Composite leading indicator (1992=100)	217.9	218.6	219.4	220.4	220.9	221.9	0.5
Housing index (1992=100)1	142.4	141.3	140.4	139.8	139.1	143.0	2.8
Business and personal services employment ('000)	2,733	2,747	2,756	2,769	2,781	2,795	0.5
S&P/TSX stock price index (1975=1,000)	11,893	11,810	11,930	12,158	12,373	12,565	1.6
Money supply, M1 ($ millions, 1992)2	150,907	151,629	153,439	155,228	157,277	159,696	1.5
U.S. Conference Board leading indicator (1992=100)3	127.1	126.9	126.8	126.8	126.7	126.8	0.1
Manufacturing
Average workweek (hours)	38.3	38.4	38.4	38.4	38.4	38.3	-0.3
New orders, durables ($ millions, 1992)4	26,125	26,033	25,753	26,072	25,857	25,973	0.4
Shipments/inventories of finished goods4	1.86	1.87	1.87	1.85	1.84	1.82	-0.025
Retail trade
Furniture and appliance sales ($ millions, 1992)4	2,535	2,550	2,568	2,590	2,605	2,615	0.4
Other durable goods sales ($ millions, 1992)4	8,477	8,590	8,685	8,725	8,749	8,788	0.4
Unsmoothed composite leading indicator	219.8	218.9	221.7	222.3	221.9	224.8	1.3
1. Composite index of housing starts (units) and house sales (multiple listing service). 2. Deflated by the Consumer Price Index for all items. 3. The figures in this row reflect data published in the month indicated, but the figures themselves refer to data for the month immediately preceding. 4. The figures in this row reflect data published in the month indicated, but the figures themselves refer to data for the second preceding month. 5. Difference from previous month.

---

Send this article to another person
E-mail to:
Your name:
Your e-mail: