The Conference Board Leading Economic Index® for Brazil, Together with Fundacao Getulio Vargas, Held Steady in December

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Jan 21, 2015, 08:00 ET

RIO DE JANEIRO, Jan. 21, 2015 /PRNewswire/ --

This month's release incorporates annual benchmark revisions to the composite economic indexes, which bring them up-to-date with revisions in the source data. Also, with this benchmark revision, the base year of the composite indexes was changed to 2010 = 100 from 2004 = 100. These revisions do not change the cyclical properties of the indexes. The indexes are updated throughout the year, but only for the previous six months. Data revisions that fall outside of the moving six-month window are not incorporated until the benchmark revision is made and the entire histories of the indexes are recomputed. As a result, the revised indexes, in levels and month-on-month changes, will not be directly comparable to those issued prior to the benchmark revision.
In addition, the Fundacao Getulio Vargas revised its seasonally adjusted series in its System of Business and Consumers Tendency Surveys. As a result the Services Sector Expectations Index, Manufacturing Industry Expectations Index and Consumers Expectations Index included in the TCB/FGV Brazil LEI were revised.
The Brazilian Institute of Geography and Statistics (IBGE) also announced methodological changes which impacted the Consumer Durable Goods Production Index included in the TCB/FGV Brazil LEI and the Industrial Production Index included in the TCB/FGV Brazil CEI.
For more information, please visit our website at http://www.conference-board.org/data/bci.cfm or contact us at [email protected].

The Conference Board Leading Economic Index^®for Brazil, together with Fundacao Getulio Vargas (TCB/FGV Brazil LEI), was unchanged in December. The index now stands at 95.4 (2010 = 100), following a 1.4 percent decline in November and a 0.2 percent increase in October. Three of the eight components contributed positively to the index in December.

"After months of decline, December's zero growth in the LEI and CEI may be a sign that the economy is stabilizing," said Paulo Picchetti, Economist at FGV/IBRE. "However, newly announced austerity policies, along with slow growth of the global economy, suggest that near-stagnant economic conditions in Brazil will persist in the near term."

"The LEI for Brazil registered no change in December and its six-month average growth rate strengthened, reflecting modest improvement in the second half of the year as compared to the sharp deterioration in the first half of 2014," said Ataman Ozyildirim, Economist at The Conference Board. "The recent stabilization of the LEI and CEI suggests that economic activity may be bottoming out, although weaknesses are still widespread in Brazil's economy."

The Conference Board Coincident Economic Index^®for Brazil, together with Fundacao Getulio Vargas (TCB/FGV Brazil CEI), which measures current economic activity, was unchanged in December at 105.7 (2010 = 100), following a 0.2 percent increase in November and a 0.4 percent increase in October. Two of the six components contributed positively to the index in December.

TCB/FGV Brazil LEI aggregates eight economic indicators that measure economic activity in Brazil. 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® for Brazil, together with Fundacao Getulio Vargas

TCB/FGV Brazil LEI was launched in July 2013. Plotted back to 1996, this index has successfully signaled turning points in the economic cycles of Brazil. The Conference Board also produces LEIs for Australia, China, the Euro Area, France, Germany, Japan, India, Korea, Mexico, Spain, the United Kingdom, and the United States.

The eight components of TCB/FGV Brazil LEI include:

Swap Rate, 1 year (Source: Central Bank of Brazil)
Stock Price Bovespa Index (Source: BOVESPA - Bolsa de Valores de Sao Paulo/ Sao Paulo Stock Exchange)
Manufacturing Survey: Expectations Index (Source: FGV/IBRE)
Services Sector Survey: Expectations Index (Source: FGV/IBRE)
Consumer Expectations Survey: Expectations Index (Source: FGV/IBRE)
Physical Production of Durables Consumer Goods Index (Source: IBGE - Instituto Brasilieiro de Geografia e Estatística/ Brazilian Institute of Geography and Statistics)
Terms of Trade Index (Source: FUNCEX - Fundacao Centro de Estudos do Comercio Exterior/The Foundation Center for the Study of Foreign Trade)
Exports Volume Index (Source: FUNCEX - Fundacao Centro de Estudos do Comercio Exterior/The Foundation Center for the Study of Foreign Trade)

https://www.conference-board.org/data/bcicountry.cfm?cid=12

To view The Conference Board calendar of 2015 indicator releases:

http://www.conference-board.org/data/

ABOUT THE CONFERENCE BOARD

The Conference Board is a global, independent business membership and research association working in the public interest. Our mission is unique: To provide the world's leading organizations with the practical knowledge they need to improve their performance and better serve society. The Conference Board is a non-advocacy, not-for-profit entity holding 501(c)(3) tax-exempt status in the United States of America.
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ABOUT FGV/IBRE

The Brazilian Institute of Economics (Instituto Brasilieiro de Economia—IBRE) at Fundacao Getulio Vargas (FGV) was founded in 1951 to research, analyze, produce and disseminate macroeconomic statistics and applied studies. Its purpose is to inform and help improve public policies and private activities in the Brazilian economy. IBRE is a leading institute in calculating the Brazilian GDP and producing price indices including the General Price Index (IGP) which served as Brazil´s official inflation index for many years. In addition to price indices, IBRE prepares trend and business cycle indicators that are widely used by administrators and analysts.
www.fgv.br/ibre

Summary Table of Composite Economic Indexes
		2014		6-month
	Oct	Nov	Dec	Jun to Dec

Leading Economic Index	96.8	95.4	95.4 p
Percent Change	0.2	-1.4	0.0 p	-0.1
Diffusion	37.5	12.5	50.0	37.5
Coincident Economic Index	105.5 r	105.7 p	105.7 p
Percent Change	0.4 r	0.2 p	0.0 p	0.9
Diffusion	83.3	66.7	50.0	91.7
n.a. Not available p Preliminary r Revised Indexes equal 100 in 2010 Sources: The Conference Board, FGV/IBRE All Rights Reserved