China's Conference Board Leading Economic Index Up in June

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The Conference Board Leading Economic Index (LEI) for China increased 1.0 percent in June to 329.6 (2004 = 100), following a 1.1 percent increase in May and a 1.5 percent increase in April. Total loans issued by financial institutions, the (inverted) PMI supplier delivery index, the 5000 industry enterprises diffusion index: raw materials supply index, the consumer expectations index, and total floor space started made positive contributions to the index. The PMI new export orders index was unchanged in June.

Said Andrew Polk, resident economist at The Conference Board China Center in Beijing, “Growth in the June China Leading Economic Index was virtually the same as in May, with credit creation making a substantial impact. China’s growth continues to be driven by bank credit rather than stronger performance in the real economy, and as such the economic outlook remains fragile.”

The Conference Board Coincident Economic Index (CEI) for China, which measures current economic activity, increased 0.4 percent in June to 276.3 (2004 = 100), following a 0.5 percent increase in May and a 0.7 percent decrease in April. Four of the five components contributed positively to the index in June.

The Conference Board LEI for China aggregates six economic indicators that measure economic activity in China. Each of the LEI components has proven accurate on its own. Aggregating individual indicators into a composite index filters out so-called “noise” to show underlying trends more clearly.

About The Conference Board Leading Economic Index® (LEI) for China

The Conference Board Leading Economic Index® for China was launched in May 2010. Plotted back to 1986, this index has successfully signaled turning points in the economic cycles of China. The Conference Board also produces LEIs for Australia, Brazil, the Euro Area, France, Germany, India, Japan, Korea, Mexico, Spain, the United Kingdom, and the United States.