The Conference Board(R) Australia Business Cycle Indicators(SM)

THE CONFERENCE BOARD LEADING ECONOMIC INDEX(R) (LEI) FOR AUSTRALIA AND RELATED COMPOSITE ECONOMIC INDEXES FOR DECEMBER 2009

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The Conference Board

Feb 24, 2010, 06:00 ET

NEW YORK, Feb. 24 /PRNewswire/ -- The Conference Board Leading Economic Index® (LEI) for Australia increased 0.6 percent and The Conference Board Coincident Economic Index® (CEI) increased 0.3 percent in December.

The Conference Board LEI for Australia increased in December, following two consecutive declines. Building approvals, the yield spread, rural good exports and stock prices made large positive contributions to the index this month. With this month's gain, the leading economic index increased by 1.4 percent (about a 2.7 percent annual rate) in the second half of 2009, an improvement from the 0.1 percent decline (about a -0.2 percent annual rate) in the previous six months. However, the strengths among the leading indicators have become slightly less widespread than the weaknesses in recent months.

The Conference Board CEI for Australia, a measure of current economic activity, also increased in December. The strengths among the coincident indicators were very widespread, as all components advanced this month. With this month's gain, the coincident economic index increased by 0.4 percent (about a 0.7 percent annual rate) in the second half of 2009, slower than the 1.1 percent increase (about a 2.1 percent annual rate) during the first half of the year. At the same time, real GDP increased at a 0.7 percent annual rate during the third quarter of 2009, after expanding at a 2.9 percent annual rate during the second quarter.

After declining for two consecutive months, The Conference Board LEI for Australia increased again in December, and its six-month growth rate has picked up somewhat. Meanwhile, The Conference Board CEI for Australia has been essentially flat since May 2009. Taken together, the current behavior of the composite indexes suggests that the economy will continue to grow at a modest pace in the near term.

LEADING INDICATORS. Five of the seven components in The Conference Board LEI for Australia increased in December. The positive contributors to the index — in order from the largest positive contributor to the smallest — are building approvals, the yield spread, rural goods exports*, share prices, and gross operating surplus*. Money supply* and the sales to inventories ratio* declined in December.

With the 0.6 percent increase in December, The Conference Board LEI for Australia now stands at 112.0 (2004=100). Based on revised data, this index declined 0.3 percent in both November and October. During the six-month period through December, the leading economic index increased 1.4 percent, and three of the seven components increased (diffusion index, six-month span equals 42.9 percent).

COINCIDENT INDICATORS. All of the four components in The Conference Board CEI for Australia increased in December. The increases - in order from the largest positive contributor to the smallest – occurred in employed persons, household gross disposable income*, retail trade, and industrial production*.

With the increase of 0.3 percent in December, The Conference Board CEI for Australia now stands at 114.3 (2004=100). Based on revised data, this index increased 0.3 percent in November and increased 0.2 percent in October. During the six-month period through December, the coincident economic index increased 0.4 percent, with two of the four components in the series making positive contributions (diffusion index, six-month span equals 50.0 percent).

DATA AVAILABILITY. The data series used to compute The Conference Board Leading Economic Index® (LEI) for Australia and The Conference Board Coincident Economic Index® (CEI) for Australia reported in this release are those available "as of" 10 A.M. ET on February 23, 2010. Some series are estimated as noted below.

* Series in The Conference Board LEI for Australia that are based on our estimates are sales to inventory ratio and gross operating surplus for private non-financial corporations, the implicit price index used to deflate rural goods exports and building approvals, and the CPI used to deflate money supply M3. Series in The Conference Board CEI for Australia that are based on our estimates are industrial production and household disposable income. CPI was used to deflate retail trade.

http://www.conference-board.org/economics/bci/

    
    
                     Summary Table of Composite Economic Indexes
    
                                                 2009                6-month
                                     Oct          Nov         Dec  Jun to Dec
    
    Leading Economic Index       111.6 p      111.3 p     112.0 p
       Percent Change             -0.3 p       -0.3 p       0.6 p       1.4
       Diffusion                  28.6         28.6        64.3        42.9
    
    Coincident Economic Index    113.7 p      114.0 p     114.3 p
       Percent Change              0.2 p        0.3 p       0.3 p       0.4
       Diffusion                  87.5        100.0       100.0        50.0
    
    
    n.a. Not available p Preliminary r Revised
    Indexes equal 100 in 2004
    Source: The Conference Board           All Rights Reserved

The next release is scheduled for March 26, 2010 at 10:00 A.M. (AEST)

In the U.S. – March 25, 2010 at 7:00 P.M. (DST)

SOURCE The Conference Board