The Conference Board® Australia Business Cycle Indicators(SM)

NEW YORK,  May 26 /PRNewswire/ -- The Conference Board Leading Economic Index® (LEI) for Australia increased 0.3 percent and The Conference Board Coincident Economic Index® (CEI) increased 0.1 percent in March.

• The Conference Board LEI for Australia increased in March, following a small decline in February. Index levels were revised upwards in recent months, as the sales-to-inventories component was revised. Between September 2009 and March 2010, the leading economic index rose 1.9 percent (a 3.8 percent annual rate), down from an increase of 2.3 percent (a 4.6 percent annual rate) for the previous six months. In addition, the strengths among the leading indicators have only been slightly more widespread than the weaknesses in recent months.

• The Conference Board CEI for Australia also increased in March, following a slight decline in February. Employed persons contributed positively to the index, more than offsetting the negative contribution from retail trade. The six-month change in the coincident economic index stands at 1.1 percent (a 2.1 percent annual rate) in the period through March 2010, up from 0.4 percent (about a 0.9 percent annual rate) for the previous six months. At the same time, real GDP increased at a 3.7 percent annual rate during the last quarter of 2009, an improvement from the gains of 1.1 percent annual rate in the third quarter and 3.0 percent average annual rate for the first half of 2009.

• The Conference Board LEI for Australia remains on a rising trend, although its six-month growth rate has slowed lately. Meanwhile, The Conference Board CEI for Australia has been essentially flat this year, after rising moderately in the second half of 2009.  Taken together, the current behavior of the composite indexes suggests that the economy will continue to expand, but perhaps at a modest pace in the near term.

LEADING INDICATORS.  Six of the seven components in The Conference Board LEI for Australia increased in March.  The positive contributors to the index — in order from the largest positive contributor to the smallest — are money supply*, the yield spread, share prices, the sales-to-inventories ratio*, rural goods exports*, and gross operating surplus*.  Building approvals* declined in March.  

With the 0.3 percent increase in March, The Conference Board LEI for Australia now stands at 115.1 (2004=100).  Based on revised data, this index declined 0.1 percent in February and increased 0.1 percent in January. During the six-month period through March, the leading economic index increased 1.9 percent, and four of the seven components increased (diffusion index, six-month span equals 64.3 percent).

COINCIDENT INDICATORS.  Three of the four components in The Conference Board CEI for Australia increased in March.  The increases - in order from the largest positive contributor to the smallest – occurred in employed persons, industrial production*, and household gross disposable income*.  Retail trade declined in March.

With the increase of 0.1 percent in March, The Conference Board CEI for Australia now stands at 114.8 (2004=100).  Based on revised data, this index decreased 0.1 percent in February and increased 0.3 percent in January.  During the six-month period through March, the coincident economic index increased 1.1 percent, with two of the four components making positive contributions (diffusion index, six-month span equals 50.0 percent).

DATA AVAILABILITY. The data series used to compute The Conference Board Leading Economic Index® (LEI) for Australia and The Conference Board Coincident Economic Index® (CEI) for Australia reported in this release are those available "as of" 10 A.M. ET on May 21, 2010.  Some series are estimated as noted below.

NOTES: Series in The Conference Board LEI for Australia that are based on our estimates are sales to inventory ratio and gross operating surplus for private non-financial corporations, the implicit price index used to deflate rural goods exports and building approvals, and the CPI used to deflate money supply M3.  Series in The Conference Board CEI for Australia that are based on our estimates are industrial production and household disposable income.  CPI was used to deflate retail trade.

The next release is scheduled for June 24, 2010 at 10:00 A.M. (AEST)

In the U.S. – June 23, 2010 at 8:00 P.M. (ET)

For more information, visit The Conference Board website: http://www.conference-board.org/economics/bci/

SOURCE The Conference Board