November 20, 2023
The Convention Board Main Financial Index for the US edged down 0.8% in October to a studying of 103.9 (2016=100). October’s lower follows a decline of 0.7% in September.
“The US Main Financial Index trajectory remained unfavourable, and its six- and 12-month development charges additionally held in unfavourable territory in October,” Justyna Zabinska-La Monica, senior supervisor of enterprise cycle indicators at The Convention Board, mentioned in a press launch.
Zabinska-La Monica famous that among the many main indicators, deteriorating shoppers’ expectations for enterprise circumstances, decrease ISM index of latest orders, falling equities and tighter credit score circumstances drove the index’s most up-to-date decline.
The LEI is now down 3.3% over the six months between April and October 2023, an enchancment from its 4.5% contraction over the earlier six months from October 2022 to April 2023.
“After a pause in September, the LEI resumed signaling a recession within the close to time period,” Zabinska-La Monica mentioned. “The Convention Board expects elevated inflation, excessive rates of interest and contracting shopper spending — as a result of depleting pandemic saving and obligatory scholar mortgage repayments — to tip the US financial system into a really quick recession. We forecast that actual GDP will increase by simply 0.8% in 2024.”
The Convention Board’s Main Financial Index serves as an early indicator for vital shifts within the enterprise cycle, offering insights into the near-term path of the financial system.
