The Conference Board Leading Economic Index® for China Increased in July

BEIJING, Aug. 22, 2012 /PRNewswire/ –The Conference Board Leading Economic Index(® )(LEI) for China increased 0.7 percent in July to 236.4 (2004 = 100), following no growth in June and a 1.1 percent increase in May. Two of the six components contributed positively to the index in July.

“The Conference Board LEI for China increased again in July,” says Andrew Polk, resident economist at The Conference Board China Center in Beijing. “The main driver was government loans to boost banks in financing infrastructure investment.” Falling prices gave an important boost to loan growth, as the latter was measured in real terms. The small increase in the CEI, a measure of current conditions, reflects some improvement in industrial production, retail sales and electricity production, suggesting that current economic conditions are stabilizing. Adds Polk: “Although other leading indicators, such as real estate, exports and consumer sentiment, remained weak through July, the leading and current indicators point to a modest rebound in the second half of 2012.”

The Conference Board Coincident Economic Index(®)( )(CEI) for China, which measures current economic activity, increased 0.8 percent in July to 222.5 (2004 = 100), following a 0.9 percent increase in June and a 0.6 percent increase in May. Four of the five components contributed positively to the index in July.

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, the Euro Area, France, Germany, Japan, Korea, Mexico, Spain, the United Kingdom, and the United States.

The six components of The Conference Board Leading Economic Index(®) (LEI) for China include:

Total Loans Issued by Financial Institutions (source: People’s Bank of China)
5000 Industry Enterprises Diffusion Index: Raw Materials Supply Index (source: People’s Bank of China)
NBS Manufacturing PMI Sub-Indices: PMI Supplier Deliveries (source: National Bureau of Statistics)
Consumer Expectations Index (source: National Bureau of Statistics)
Total Floor Space Started (source: National Bureau of Statistics)
NBS Manufacturing PMI Sub-Indices: Export Orders (source: National Bureau of Statistics)

For more information including full press release and technical notes: http://www.conference-board.org/data/bcicountry.cfm?cid=11

To view The Conference Board calendar of 2012 indicator releases: http://www.conference-board.org/data/

About The Conference Board
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                                                           Summary Table of Composite Economic Indexes

                                                             2012                                 6-month
                                            May                           Jun                           Jul         Jan to Jul

    Leading Economic
     index (LEI)                                 234.7  p                      234.8  p                     236.4 p
        Percent Change                             1.1  p                        0.0  p                       0.7 p              4.5
        Diffusion                                 75.0                          25.0                         41.7               50.0

    Coincident
     Economic Index
     (CEI)                                       218.8  r                      220.8                        222.5 p
        Percent Change                             0.6                           0.9                          0.8 p              6.3
        Diffusion                                 70.0                          80.0                         80.0              100.0

    n.a. Not available     p Preliminary     r Revised
    Indexes equal 100 in 2004
    Source: The Conference Board       All Rights Reserved

SOURCE The Conference Board