The Conference Board Leading Economic Index® (LEI) for China increased 0.9 percent in October to 152.1 (2004 = 100), following a 0.6 percent increase in September and a 0.7 percent increase in August. Five of the six components contributed positively to the index in October.

The Conference Board LEI for China increased again in October, with all components except consumer expectations advancing this month. With the gain in October, the sixmonth growth rate of the leading economic index continued to pick up, to 5.2 percent (a 10.6 percent annual rate) from April to October 2010, from 2.6 percent (a 5.3 percent annual rate) for the previous six months. The strengths among the leading indicators have remained widespread in recent months.

The Conference Board CEI for China, a measure of current economic activity, increased slightly in October. Electricity production, which has declined for two consecutive months, made a large negative contribution to the index this month. With the small gain in October, the six-month growth rate of the coincident economic index has moderated somewhat, to 4.8 percent (a 9.8 percent annual rate) from April to October 2010, from 6.8 percent (a 14.0 percent annual rate) for the previous six months. In addition, the strengths among the coincident indicators have become slightly less widespread in the last six months, for the first time since April 2009.

The Conference Board LEI for China continued its upward trend, with its six-month growth rate picking up slightly in recent months. Nonetheless, the consumer expectations index has declined for four consecutive months through October. In addition, this month the Conference Board CEI for China grew at the slowest monthly rate since early 2009, and its six-month growth rate has moderated slightly as a result. Taken together, the behavior of the composite indexes and their components suggest that despite moderating somewhat recently, the economic expansion should continue into 2011.

LEADING INDICATORS

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

With the increase of 0.9 percent in October, The Conference Board LEI for China now stands at 152.1 (2004=100). This index increased 0.6 percent in September and increased 0.7 percent in August. During the six-month span through October, The Conference Board LEI for China increased 5.2 percent, and five of the six components advanced (diffusion index, six-month span equals 83.3 percent).

COINCIDENT INDICATORS

Two of the five components that make up The Conference Board CEI for China increased in October. The positive contributors to the index include manufacturing employment and value-added industrial production. Electricity production and retail sales of consumer goods declined, while volume of passenger traffic remained unchanged in October.

With the increase of 0.1 percent in October, The Conference Board CEI for China now stands at 191.8 (2004=100). This index increased 0.7 percent in September and increased 1.0 percent in August. During the six-month span through October, The Conference Board CEI for China increased 4.8 percent, and four of the five components advanced (diffusion index, six-month span equals 80.0 percent).