U.S. Leading Economic Index likely to have dropped in December
The U.S. Leading Economic Index data for the month of December is set to release tomorrow. According to a Wells Fargo research report, tomorrow’s reading is expected to indicate towards a very modest drop in economic growth prospects. The Leading Economic Index is expected to have dropped 0.3 percent, said Wells Fargo.
The index, which is a composite of 10 different variables designed to signal peaks and troughs in the economic cycle, was flat in November following three consecutive falls. Softness has been mainly seen in manufacturing, while equity market strength and an upturn in residential building permits have stimulated the index. Stocks continued to roll in December, while manufacturing output surprised to the upside.
“The signing of the Phase I trade deal may modestly lift the index in coming months. More broadly, the Conference Board states that the LEI is indicating that “economic growth is likely to stabilize around 2 percent in 2020.” This characterization is in accord with our own forecast of full-year growth of 2.1 percent in 2020”, added Wells Fargo.