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U N IT E D STATES D EPAR TM EN T OF BUREAU O F E C O N O M IC A N A L Y S IS WASHINGTON, D.C. 20230 FOR WIRE TRANSMISSION 2;00 P„M. TUESDAY, FEBRUARY 28, 1978 Fel i ks Tamm: ( 202) 523- 0535 b ea 78- 15 COMPOSI TE I NDEXES OF LEADI NG, COI NCI DENT, AND LAGGI NG I NDI CATORS: JANUARY 1978 The composi t e i ndex of l eadi ng i ndi cat or s decr eased 1. 9 per cent i n Januar y, and now st ands at 132. 8 ( 1967=100) , accor di ng t o pr el i mi nar y dat a r el eased t oday by t he Bur eau of Economi c Anal ysi s, U. S. Depar t ment of Commer ce. On t he basi s of mor e compl et e dat a, t he December i ndex has been r evi sed t o 135. 4, 0. 7 per cent above t he November f i gur e. The December f i gur e f or aver age wor kweek was t he maj or cont r i but or t o t he r evi si on. Ei ght of t en i ndi cat or s avai l abl e f or Januar y cont r i but ed t o t he decl i ne i n t he i ndex: aver age wor kweek, vendor per f or mance, change i n t ot al l i qui d asset s ( t ot al l i qui d asset s i ncr eased at a decl i ni ng r at e) , cont r act s and or der s f or pl ant and equi pment i n 1972 dol l ar s, st ock pr i ces, money bal ance i n 1972 dol l ar s, new or der s i n 1972 dol l ar s, and bui l di ng per mi t s. Two of t en i nf l uenced t he i ndex i n t he opposi t e di r ect i on: r at e and change i n sensi t i ve pr i ces. l ayof f The ser i es cont r i but i ng most t o t he decl i ne i n t he i ndex was aver age wor kweek. Of t he ser i es t hat i nf l uenced t he i ndex i n t he opposi t e di r ect i on, change i n sensi t i ve pr i ces had t he l ar gest i nf l uence. The sever i t y of t he Januar y weat her had an i mpact of unknown magni t ude on t he nat i onal economy. Col d weat her and heavy snowf al l i n var i ous par t s of t he count r y adver sel y af f ect ed component ser i es such as aver age wor kweek and bui l di ng per mi t s t o a gr eat er ext ent t han coul d be t aken i nt o account by t he seasonal adj ust ment pr ocess. The composi t e i ndex of coi nci dent i ndi cat or s, whi ch i s a mont hl y appr oxi mat i on of aggr egat e economi c act i vi t y, decr eased 0. 3 per cent i n Januar y and now st ands at 133. 9 ( 1967=100) . On t he basi s of mor e compl et e dat a, t he December i ndex has been r evi sed t o 134. 3, 0. 8 per cent above t he November f i gur e. The composi t e i ndex of l aggi ng i ndi cat or s i ncr eased 2. 1 per cent i n Januar y and now st ands at 135. 3 ( 1967=100) . On t he basi s of mor e compl et e dat a, t he December i ndex has been r evi sed t o 132. 5, t he same as November . - 2 - The l eadi ng i ndex i s desi gned t o pr edi ct mont hl y movement s i n aggr egat e economi c act i vi t y, whi ch i s appr oxi mat ed by t he coi nci dent i ndex. The l aggi ng i ndex i s desi gned t o conf i r m t he si gnal s of t he l eadi ng i ndex and t o hel p di st i ngui sh bet ween r andom movement s and basi c changes i n busi ness condi t i ons. These concept s ar e mor e f ul l y expl ai ned i n t he H a n d b o o k o f C y c l i c a l I n d i c a t o r s a suppl ement t o B u s i n e s s C o n d i t i o n s D i g e s t ( B C D ) , avai l abl e f r om t he Super i n t endent of Document s at t he pr i ce of $4. 00. Mor e dat a on t he composi t e i ndexes, as wel l as ot her i mpor t ant measur es of economi c act i vi t y, appear i n B C D . I t i s avai l abl e f r om t he Super i nt endent of Document s, U. S. Gover nment Pr i nt i ng Of f i ce, Washi ngt on, D. C. 20402. Annual subscr i pt i on: $40. 00. N ext r e le a s e d a te: Mar ch 30 f or t he Febr uar y composi t e i ndexes. C O M P O S IT E IN D E X E S Rat i o S c a le — ] 140 130 - 120 _ 110 - 140 - 130 - 120 - 110 - 140 - 130 - 120 - no 100 P ( peak) i ndi c a t e s e nd of ge ne r a l bus i ne s s e x pa ns i on a nd be gi n ni n g o f r e ce s s i on, a nd T ( t r ough) i ndi c a t e s e nd of ge ne r a l bus i ne s s r e c e s s i on a nd be gi nn i n g of e x pa ns i on; s ha de d ar ea s t hus r e pr e s e nt r e c e s s i ons . Numbe r s e nt e r e d on t he char t i ndi c a t e l e ngt h o f l e a ds ( - ) a nd l a gs ( +) i n mont hs f r om t he s e bus i ne s s c y c l e t ur ni n g dat es. Co mp o s i t e I nde x of Leadi ng I ndi c a t or s ( 1967=100) Mo n t h l y J^ar W i i 1973 1974 1975 1976 1977 1978 Jan. Feb. 119.2 132.8 128.9 106.5 120.4 133.5 129.2 106.2 1 2 1 . 2 1 2 2 . 0 126.3 p i 32.8 127.3 Mar. 122.3 132.7 129.3 107.1 123.2 r 129.9 Apr. 123.5 131.8 127.4 109.4 123.0 130.4 May 123.9 132.6 126.9 111.7 124.5 r 130.0 Oct. June July Aug. Sep. 124.3 133.7 124.8 115 .2 125.6 r 129.8 125.3 133.2 124.1 117.8 125.7 130.0 126.5 131.6 120 .9 118.6 125.6 r 132.2 128.2 130.8 117.2 118.9 125.3 r 132.9 129.4 130.4 114.4 119.0 126.1 134.2 ! Nov. Dec. 130.2 130.5 111.5 119.3 127 .0 r l 34.4 132.1 129.3 109.8 119.6 127.7 r l 35.4 Nov. Dec. Percent Change Year Jan. 1972 1973 1974 1975 1976 1977 1978 Feb. Mar. Apr. 1 . 0 1 . 6 1 . 0 1 . 1 0.5 -0.3 -3.0 1.3 -1 . 1 p - 1 .9 0.5 -0 -0.7 -1.5 .6 0 . 2 0 . 1 -0.3 0.7 0 .8 0 . 8 2 .0 2 . 1 -0 .2 r 0 .4 1 . 0 July Aug. Sep. Oct. 0.3 0.3 0 . 8 1 . 0 1.3 0 . 6 0 .8 -0.4 -0 . 6 2.3 -1 . 2 -2 . 6 0.7 -0 . 1 r 1 .7 0.9 -0.3 -2.4 May June -0.4 -1.7 3.1 0.9 -0 . 2 2 . 1 1 . 2 r-0.3 0 . 1 r0 .2 -0 . 6 -3.1 0.3 -0 . 2 r 0 .5 0 . 6 0 .1 -2.5 0.3 0.7 0 . 1 0 . 6 rl .0 0 . 1 1.5 -0.9 -1.5 0.3 0 . 6 0.7 Quar t e r l y Year I 1972 1973 1974 1975 1976 1977 133.0 129.1 106.6 Year I 1972 1973 1974 1975 1976 1977 -0 . 8 -4.7 2.3 0.7 1 1 2 . 1 124.4 r 130.1 1 2 2 . 1 127.8 130.6 130.1 111.9 119.3 126.9 r l 3 4 .7 126.7 131.9 120.7 118.4 125.5 r l 31.7 123.9 132.7 126.4 12 0 . 6 IV III II Percen t C hange II 3.0 2.7 -0 . 2 -2 . 1 5.2 1.9 r1 . 8 1 . 8 IV III Indicator 2.3 -0 . 6 -4.5 5.6 0.9 3.1 -1.4 -7.3 1 . 2 r 2 .3 0 .8 1 . 1 B a sic Data Aug. Sep. Oct. Nov. Dec. Jan. 40.3 40.3 40.4 40.5 r 40.5 p 3 9 .7 (percent).... 1.3 1.3 V endor performance, companies reporting slower deliveries (pe r c e n t ) ............ 58 56 Aver a g e workweek, production workers. m a n u f acturing ( h o u r s ) ................... ♦Layoff rate, #Change m a nufacturing in total liquid assets (percent). 0.98 1.08 #Change in sensitive prices (WPI of crude mtrls., excl. food, feeds) (percent).. rO .02 Con t r a c t s and orders, plant & equipment. (billions of 1972 d o l l a r s ) ............. 1 . 1 56 rl 0.9 50 .0 p 0 .9 Net C o n t r i b u t i o n D i r e c t i o n of C hange to Index 1 Nov. Dec. Dec. to to to Jan. Jan. Dec. -0.72 - -0.09 +0 + +0 -0.04 “ - 0 .0 . 1 1 56 55 -0.09 -0.46 + 0.18 + 0.31 + 2 + 0.34 -0 - n.a. + 0.06 -0.03 -0 +0 -0.07 1 . 1 0 1 . 1 0 rl .07 p0.94 r0.28 r0.48 r0.59 rO .99 1.58 r l 2.31 r l 3.27 rl2.06 rll.96 r l 3 .67 (1967=100). 130.6 129.6 r l 32.0 133.4 e l 34 .0 Index of stock prices. 500 common stocks (1941-43=10)...... 97.75 96.23 93.74 94.28 93.82 90.25 M o ney balance (billions of 1972 $) 224.6 225.2 226.9 225.5 226.1 p 2 2 5 .8 New orders, m f g . , consumer products and materials, (billions of 1972 $ ) ...... r 3 5 .19 r 34.77 r 35.0 5 r 35.27 r 3 6 .47 p3 5.7 4 + 0.16 -0 . 1 1 - 152.7 146.1 159.4 163.1 156.1 p i 28.9 -0.14 -0.71 - r+14.68 r+15.38 r+14.10 r+12.13 p+9.33 n.a. -0.16 n.a. 0.74 -1.92 Net business formation (Ml), Building permits index (1967 = 1 0 0 ) .............. #Change in inventories on hand and on ord e r (ann. rate, billions of 1972 $). Percent change in the index 2 ........ (*) Series inverted in c alculating the composite ansidered an increase in the series. V) n.a. pl3. 2 . 2 1 index of leading indicators: a decrease . 1 2 . 10 n.a. . 2 7 - in the layoff rate is Smoothed by a weighted 4-month moving average placed at terminal month. - not available p - p r eliminary r - revise d 1 Ne t c o n t r i b u t i o n o f e a c h i n d i v i d u a l c o mp o n e n t i s t hat The pe r c e nt c h a nge i n t he i nde x e q u a l s t he s um of t he t r e n d a d j u s t me n t f a c t o r o f 0 . 1 7 ( e x c e p t f o r o c c a s i o n a l e - e s timated c o mp o n e n t ' s s h a r e i n t h e ne t c o n t r i b u t i o n s of t he r oundi ng di f f er ences) . c o mp o s i t e mo v e me n t o f i n d i v i d u a l c o mp o n e n t s t he gr oup. pl us t he Co mp o s i t e I nde x of Co i n c i d e n t I ndi c a t or s ( 1967=100) Mo n t h l y Year Jan. 1972 1973 1974 1975 1976 1977 1978 112.9 123.8 126.8 113.9 118.7 125.2 pi33.9 Year Jan. Feb. Mar. 113.3 125.1 126.1 112.3 114.5 125.6 125.8 110.9 12 0 .0 1 2 1 . 2 126.5 128.8 Feb. Mar. Apr. 115.5 125 . 6 125.5 111.4 121.9 129.1 May 116 . 1 126.0 125.7 1 1 1 . 8 12 2 .0 129.5 June July Aug. Sep. Oct. 115.8 126.2 125.5 112.7 122.5 130.2 116.7 126.9 125.7 113.7 122.7 130.5 118.2 126.6 125.2 115.4 123.2 130.6 118.8 127.2 124 . 6 116.3 123.0 131.3 120.4 128.2 123.3 116.7 122.7 132.4 Nov. July Aug. Sep. Oct. 0.5 0.5 -0 .5 1.3 1. 0 0 .8 0.5 Dec. 1 2 1 . 6 12 2 . 6 128.8 119.9 116.9 123.9 r l 3 3 .3 127 .9 116.2 117 . 6 126.0 r l 3 4 .3 Nov. Dec. Percent Change 1972 1973 1974 1975 1976 1977 1978 Apr. June -0 . 2 0 .5 0 .2 0.4 0 .8 0.9 1 . 1 1. 0 0 .6 0 . 1 0 .2 1. 0 1 . 8 0 .2 0.3 0.4 0.5 1.3 -0 . 2 -0.4 1.5 0.4 0 .2 0 . 1 1.5 0.4 1 . 1 0.9 1. 0 1. 0 0.4 0 .0 -0.9 -2 . 0 0.9 -0 . 6 p-0.3 May -0 . 6 -1.4 -0 . 2 -1 . 2 0.5 0.3 -0 .3 0 .8 0 .2 0 .6 -0 0 .2 .2 0 .8 -0 . 2 0.5 -1 . 0 0.3 -0 . 2 0 .8 -2 .8 0 .8 -0.7 -3.1 0 .2 0 .6 1. 0 1.7 r0 . 8 r0.7 Quarterly Year I 1972 1973 1974 1975 1976 1977 IV III II 113.6 124.8 126 . 2 112.4 115.8 125.9 125.6 12 0 .0 1 2 2 . 1 126.8 129.6 121.5 128.3 119.8 117.1 124.2 r 1 3 3.3 117 .9 126.9 125.2 115.1 123 .0 130.8 1 1 2 . 0 Percent Change Year I 1972 1973 1974 1975 1976 1977 3.1 2.7 1.9 0.9 -0.5 -0.4 1.7 -1 . 6 -6 . 2 2.5 2 . 1 IV III II 3.1 1 . 8 1 . 1 0 .8 2 .8 -4.3 1.7 0 .7 0.9 rl .9 -0.3 2 . 2 1. 0 Compos ite Index of Lagging Indicators 2 (1967=100) Monthly Year Jan. Feb. Mar. Apr. 1972 1973 1974 1975 1976 1977 1978 105.4 112.7 134.3 143.4 104.4 114.3 133.2 138.1 12 0 .8 1 2 0 . 1 104.8 116 . 2 132.8 134.5 119.8 rl2 2 . 8 105.6 118 . 6 137.4 130.8 119.2 123.3 1 2 1 . 6 rl 2 2 .3 May June July Aug. Sep. Oct. 106.3 106.9 107.3 125.9 146.0 124.2 107.5 129.2 146 .4 124.5 120.9 r l 28.1 108.6 131.7 147.1 124 .4 121.9 r l 2 9 .4 109.5 131.7 146.7 125.3 121.7 131.1 Aug. Sep. Oct. 1 2 0 . 1 12 2 . 6 142.1 128.5 119 .7 r l 2 4 .3 143.6 124.1 12 1. 0 1 2 1 . 1 r l 26.5 r 126.9 Nov. Dec. 110 . 0 1 1 0 . 6 132.0 145.2 123.1 133.2 145.1 1 2 1 . 2 r 132.5 120.9 132.5 Nov. Dec. 0.5 0.5 0 .9 -0 . 1 -0.9 -0 . 2 rO.O 12 2 . 0 pi 35.3 Percent Change Year Jan. Feb. Mar. Apr. 1972 1973 1974 1975 1976 1977 1978 -1 . 2 1.9 -0.9 1.4 -0 . 8 -3.7 -0 . 6 r0 . 6 0.4 1.7 -0.3 -2 . 6 -0 . 2 r 0 .4 0 .8 0 .8 -1 . 2 -1 . 0 0 .6 June May 3.5 0.7 1.3 3.4 -2 . 8 -0.5 r 0 .4 -1 . 8 0.4 r0 . 8 2 . 1 0 .6 2 . 1 1 . 1 -3.4 1 . 1 rl .8 July 0.4 2.7 1.7 0 . 1 0 .1 r0.3 0 .2 1. 0 2 .6 1.9 0.5 0.3 0 .2 -0 . 2 r0.9 -0 . 1 0 .8 rl .0 0 .8 0 .0 0 .2 -0.3 0 .7 -0 . 2 rl .3 -1 . 0 -1 . 8 -0.4 1 . 1 P 2 ■1 Quarterly I 1972 1973 1974 1975 1976 1977 104.9 114 .4 133.4 138.7 12 0 . 2 rl2 III II Year 2 .2 106.3 120.4 141.0 127.8 12 0 .0 r l 2 4 .7 107.8 128.9 146.5 124.4 121.3 r l 28.1 IV .0 132.3 145.7 123.5 121.3 r l 32.0 1 1 0 Percent Change Year 1972 1973 1974 1975 1976 1977 p - preliminary I -2 . 1 4 .0 0 .8 -4.8 -2.7 r 0 .7 II 1.3 5.2 5.7 -7.9 -0 . 2 r2 . 0 III IV 1 .4 7 .1 3.9 -2.7 2 .0 1 . 1 r 2 .7 2 .6 -0.5 -0.7 0 .0 r3.0 r - revised Includes Employees on nonagricultural payrolls; Industrial production index; 2 Personal income less transfer payments in 1972 dollars; Manufacturing and trade sales in 1972 dollars. Includes Average duration of unemployment; Labor cost per unit of output, manufacturing; Manufacturing and trade inventories in 1972 dollars; Commercial and industrial loans outstanding; Average prime rate charged by banks; Ratio, consumer installment debt to personal income.
@FedFRASER