The Conference Board CEI for Australia, a measure of current economic activity, also declined slightly in May. Industrial production and retail trade both fell this month. The six-month change in the coincident economic index has also turned negative — to a 0.1 percent decline (a -0.2 percent annual rate) for the period ending in May 2011, down from 1.1 percent (a 2.2 percent annual rate) for the previous six months. At the same time, real GDP contracted by 4.7 percent (annual rate) in the first quarter of this year, down from the increase of 3.3 percent annual rate in the last quarter of 2010.
The Conference Board LEI for Australia continued its slightly downward trend that started at the beginning of this year, and its six-month growth rate remains negative as a result. At the same time, The Conference Board CEI for Australia has declined for two consecutive months through May, and its six-month growth rate has turned negative for the first time since late 2009. Taken together, the current behavior of the composite indexes suggests that economic activity will remain slow in the near term.
LEADING INDICATORS
Three of the seven components in The Conference Board LEI for Australia increased in May. The positive contributors to the index - in order from the largest positive contributor to the smallest - are money supply, rural goods exports, and the yield spread. Building approvals, share prices, the sales to inventories ratio, and gross operating surplus declined in May.
With the 0.1 percent decrease in May, The Conference Board LEI for Australia now stands at 119.3 (2004=100). Based on revised data, this index increased 0.2 percent in April and declined 0.3 percent in March. During the six-month period through May, the leading economic index decreased 0.7 percent, and four of the seven components increased (diffusion index, six-month span equals 64.3 percent).
COINCIDENT INDICATORS
One of the four components in The Conference Board CEI for Australia increased in May. The increase occurred in household gross disposable income. Retail trade and industrial production declined, while employed persons remained unchanged in May.
With the decrease of 0.1 percent in May, The Conference Board CEI for Australia now stands at 117.8 (2004=100). Based on revised data, this index decreased 0.1 percent in April and increased 0.2 percent in March. During the six-month period through May, the coincident economic index decreased 0.1 percent, with two of the four components in the series making positive contributions (diffusion index, six-month span equals 50.0 percent).
