The Conference Board Leading Economic Index® (LEI) for the Euro Area Decreased in May

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Jun 28, 2012, 04:00 ET

BRUSSELS, June 28, 2012 /PRNewswire/ -- The Conference Board Leading Economic Index® (LEI) for the Euro Area decreased 0.3 percent in May, falling to 105.2 (2004=100), following decreases of 1.0 percent in April and 0.1 percent in March.

Said Jean-Claude Manini, The Conference Board Senior Economist for Europe: "The LEI for the Euro Area fell for a third consecutive month in May, but at a slower pace. Stock prices and business confidence were once again the main contributors to the decline. The sharp deterioration in confidence suggests that output growth has fallen back into negative territory in recent months. If confidence in the economy and Europe's financial situation cannot be restored quickly, economic activity may experience a deeper and longer contraction than currently projected."

The Conference Board Coincident Economic Index® (CEI) for the Euro Area, which measures current economic activity, was unchanged in May. The index now stands at 101.9 (2004 = 100) according to preliminary estimates*. The CEI decreased 0.4 percent in April and remained unchanged in March.

About The Conference Board Leading Economic Index® (LEI) for the Euro Area
The Conference Board Leading Economic Index® for the Euro Area was launched in January 2009. Plotted back to 1987, this index has successfully signaled turning points in the business cycle of the bloc of countries that now constitute the Euro Area, defined by the common currency zone.

The Conference Board currently produces leading economic indexes for ten other individual countries, including Australia, China, France, Germany, Japan, Korea, Mexico, Spain, the U.K. and the U.S.

The seven components of The Conference Board Leading Economic Index® for the Euro Area include:

Economic Sentiment Index (source: European Commission DG-ECFIN)
Index of Residential Building Permits Granted (source: Eurostat)
EURO STOXX® Index (source: STOXX Limited)
Money Supply (M2) (source: European Central Bank)
Interest Rate Spread (source: European Central Bank)
Eurozone Manufacturing Purchasing Managers' Index (source: Markit Economics)
Eurozone Service Sector Future Business Activity Expectations Index (source: Markit Economics)

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

* Series in The Conference Board LEI for the Euro Area that are based on The Conference Board estimates are real money supply and residential building permits. All series in The Conference Board CEI for the Euro Area are based on The Conference Board estimates (employment, industrial production, retail trade, and manufacturing turnover).

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.

Summary Table of Composite Indexes
	2012						6-month
	Mar		Apr		May		Nov to May
Leading Economic Index (LEI)	106.6	p	105.5	p	105.2	p
Percent Change	-0.1	p	-1.0	p	-0.3	p	1.0	p
Diffusion	35.7		28.6		42.9		57.1

Coincident Economic Index (CEI)	102.3	p	101.9	p	101.9	p
Percent Change	0.0	p	-0.4	p	0.0	p	-0.6	p
Diffusion	25.0		0.0		75.0		0.0	n.a.

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

This month's release incorporates benchmark revisions to both composite indexes, following Eurostat's decision to stop collecting data for new orders of capital goods. The Conference Board has therefore removed this component from the LEI for the Euro Area and is currently conducting research to find a suitable replacement for this series. This benchmark revision also brings the indexes up-to-date with revisions in the underlying data. The revision to the LEI, but not to The Conference Board CEI for the Euro Area, may change the cyclical properties of the index because its composition has changed. 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 incorporated when a benchmark revision is made and the entire histories of the indexes are recomputed. As a result, the revised indexes and their month-over-month changes will no longer be directly comparable to those issued prior to the benchmark revision.

For more information, please visit our website at http://www.conference-board.org/data/bci.cfm or contact [email protected].

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SOURCE The Conference Board