Indicating a potential easing of economic conditions, the Conference Board released a report on Friday revealing a continued decline in its leading U.S. economic indicators for April.
According to the Conference Board, the leading economic index dropped by 0.6 percent in April, following a 0.3 percent decrease in March. Economists had anticipated another 0.3 percent decline.
"The decline in April was driven by a negative outlook on business conditions among consumers, weaker new orders, a negative yield spread, and a reduction in new building permits," explained Justyna Zabinska-La Monica, Senior Manager of Business Cycle Indicators at The Conference Board. "Additionally, for the first time since October last year, stock prices negatively impacted the index."
The report also highlighted that the leading economic index fell by 1.9 percent over the six months from October 2023 to April 2024, a smaller drop compared to the 3.5 percent decline in the preceding six months.
Zabinska-La Monica noted, "Although the six-month and annual growth rates of the LEI no longer suggest an imminent recession, they still indicate significant obstacles to growth are ahead. Elevated inflation, high interest rates, increasing household debt, and reduced pandemic savings are all expected to continue to exert pressure on the U.S. economy in 2024."
She further projected, "Consequently, we anticipate that real GDP growth will decelerate to below 1 percent during the Q2 to Q3 2024 period."
In addition, the Conference Board reported that the coincident economic index rose by 0.2 percent in April, consistent with the increase seen in March, while the lagging economic index grew by 0.4 percent in April, following no change in March.