The Conference Board CEI for France, a measure of current economic activity, decreased slightly in February. Between August 2009 and February 2010, the index was unchanged after decreasing 0.5 percent (about a -1.0 percent annual rate) during the previous six months. Additionally, the strengths among the coincident indicators have been widespread in recent months. At the same time, real GDP expanded at a 2.4 percent annual rate in the fourth quarter of 2009, its third consecutive quarter of growth.
The Conference Board LEI for France has risen sharply since the first quarter of 2009, though its six-month growth rate has moderated from the high it reached in October 2009. Meanwhile, The Conference Board CEI for France has remained flat during the past six months, after a long period of decline. Taken together, the recent behavior of the composite indexes suggests that the improvement in economic activity should continue in the near term.
LEADING INDICATORS
Three of the seven components of the leading economic index increased in February. The positive contributors to the index - in order from the largest positive contributor to the smallest — are the yield spread, inverted new unemployment claims and building permits (residential). The negative contributors to the index - beginning with the largest negative contributor - are the stock price index, production expectations, industrial new orders and the ratio of the deflator of manufacturing value added to unit labor cost for manufacturing.
With the increase of 0.2 percent in February, the leading economic index now stands at 107.3 (2004=100). Based on revised data, this index increased 0.7 percent in January and increased 0.5 percent in December. During the six-month span through February, the index increased 3.4 percent, and five of the seven components increased (diffusion index, six-month span equals 71.4 percent).
COINCIDENT INDICATORS
One of the four components of the coincident economic index increased in February. Wage and salaries was the only positive contributor. Personal consumption and employment declined in February, while industrial production remained unchanged.
With the decrease of 0.1 percent in February, the coincident economic index now stands at 103.4 (2004=100). Based on revised data, this index remained unchanged in both January and December. During the six-month period through February, the index remained unchanged, with three of the four series making a positive contribution (diffusion index, six-month span equals 75.0 percent).
