The Conference Board CEI for Germany, a measure of current economic activity, declined in September, with all four components contributing negatively to the index. The six month change in the index stands at 1.1 percent (a 2.1 percent annual rate) through September 2010, down from 1.8 percent (a 3.6 percent annual rate) in the first half of the year. However, the strengths among the coincident indicators have remained widespread in recent months. At the same time, real GDP increased at a 2.8 percent annual rate in the third quarter of 2010, down from the revised increase of 9.5 percent annual rate in the previous quarter.
The Conference Board LEI for Germany has been on an uptrend since April 2009, amid widespread strengths among its components. However, its six-month growth rate has moderated most recently. Meanwhile, The Conference Board CEI for Germany is essentially unchanged since this spring. Taken together, the recent behavior of the composite indexes suggests that economic activity should continue expanding, though perhaps at a moderate pace in the near term.
LEADING INDICATORS
Four of the seven components in The Conference Board LEI for Germany increased in September. The positive contributors - in order from the largest positive contributor to the smallest - were the yield spread, consumer confidence, stock prices, and new residential construction orders. New orders in investment goods industries made a negative contribution. Inventory change and gross enterprises and properties income remained unchanged in September.
With the 0.3 percent increase in September, The Conference Board LEI for Germany now stands at 106.5 (2004=100). Based on revised data, this index increased 1.0 percent in August and increased 1.0 percent in July. During the six-month span through September, the index increased 5.8 percent, with six of the seven components increasing (diffusion index, six-month span equals 85.7 percent).
COINCIDENT INDICATORS
All four components that make up The Conference Board CEI for Germany - retail trade, industrial production, manufacturing sales, and employment - made negative contributions in September.
With the 0.3 percent decrease in September, The Conference Board CEI for Germany now stands at 104.0 (2004=100). Based on revised data, this index increased 0.2 percent in August and remained unchanged in July. During the six-month period through September, the index increased 1.1 percent, with three of the four components increasing (diffusion index, six-month span equals 87.5 percent).
