The Conference Board Leading Economic Index® (LEI) for China increased 1.3 percent in July. The index stands at 297.7 (2004 = 100), following a 1.3 percent increase in June and a 0.7 percent increase in May. Five of the six components contributed positively to the index in July.
Andrew Polk, resident economist at The Conference Board China Center in Beijing, said: "The six-month growth rate of the China LEI increased considerably in July. However, the improvement was driven primarily by an increase in new floor space starts, which is unsustainable in the longer-term. Bank loans, meanwhile, offered their weakest contribution to the LEI since January 2012. Given tight financing conditions and a still-fragile real estate market, there is some doubt as to whether recently improved LEI growth will translate into an acceleration of economic growth in the second half of 2014."
The Conference Board Coincident Economic Index® (CEI) for China, which measures current economic activity, increased 1.2 percent in July to 265.1 (2004 = 100), following a 0.9 percent increase in June and a 0.7 percent increase in May. Four of the five components contributed positively to the index in July.
The Conference Board LEI for China aggregates six economic indicators that measure economic activity in China. Each of the LEI components has proven accurate on its own. Aggregating individual indicators into a composite index filters out so-called "noise" to show underlying trends more clearly.
