Leading Indicators Rise Two Consecutive Weeks

Chart of the Week for November 30-December 6, 2001

The ECRI Weekly Leading Index is comprised of seven data series all with qualities indicating leading business cycle behavior. This index posted its second consecutive weekly increase; on a rolling 6 month basis, it has increased in each of the past five weeks. The index traditionally leads recoveries by three months and downturns by almost one year. The notable areas of recent strength in this index include the financial markets, housing and money supply. The labor markets remain weak and in fact initial jobless claims increased substantially from the previous week. On the whole, the index’s recent increase is positive, however its six month growth rate is still negative indicating a recessionary environment. A considerable and sustained improvement is required before a recovery is indicated.

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