The Conference Board Leading Economic Index®(LEI) for China increased 1.0 percent in June to 158.9 (2004 = 100), following a 0.6 percent increase in May and a 0.3 percent increase in April. Five of the six components contributed positively to the index in June.

The Conference Board LEI for China increased sharply in June, and there were upward revisions to the previous months as actual data for the 5000 industry enterprises diffusion index became available for the first quarter. The consumer expectations index and total loans issued by financial institutions were the largest positive contributors this month. With the gain in June, the six-month growth in the leading economic index picked up to 4.1 percent (about a 8.3 percent annual rate) in the first half of 2011, from 1.9 percent (about a 3.9 percent annual rate) in the second half of last year. In addition, the strengths among the leading indicators have been more widespread than the weaknesses in recent months.

The Conference Board CEI for China, a measure of current economic activity, also increased sharply in June. All components advanced this month. With June’s gain, the six-month growth rate of the coincident economic index rose to 5.1 percent (about a 10.5 percent annual rate) in the first half of 2011, up from 2.8 percent (about a 5.7 percent annual rate) for the previous six months. The strengths among the coincident indicators have remained widespread in recent months.

The Conference Board LEI for China has resumed its upward trend in the first half of 2011, after a brief pause in the fourth quarter of last year. The growth rate of the LEI picked up sharply in the first six months of the year. In the meantime, The Conference Board CEI for China continued to rise through June, and its six-month growth rate has also picked up. Taken together, the recent behavior of the composite indexes and their components so far suggests that economic expansion will continue in the near term.

LEADING INDICATORS

Five of the six components that make up The Conference Board LEI for China increased in June. The positive contributors to the index - in order from the largest positive contributor to the smallest – include the consumer expectations index, total loans issued by financial institutions, PMI new export orders, the 5000 industry enterprises diffusion index: raw materials supply index , and total floor space started. The (inverted) PMI supplier delivery index declined in June.

With the increase of 1.0 percent in June, The Conference Board LEI for China now stands at 158.9 (2004=100). Based on revised data, this index increased 0.6 percent in May and increased 0.3 percent in April. During the six-month span through June, The Conference Board LEI for China increased 4.1 percent, and four of the six components advanced (diffusion index, six-month span equals 66.7 percent).

COINCIDENT INDICATORS

All five components that make up The Conference Board CEI for China increased in June. The positive contributors to the index – in order from the largest positive contributor to the smallest – include volume of passenger traffic, value-added of industrial production, electricity production, manufacturing employment, and retail sales of consumer goods.

With the increase of 1.2 percent in June, The Conference Board CEI for China now stands at 205.3 (2004=100). Based on revised data, this index increased 0.5 percent in May and increased 1.3 percent in April. During the six-month span through June, The Conference Board CEI for China increased 5.1 percent, and four of the five components advanced (diffusion index, six-month span equals 80.0 percent).