A leading index for the Australian economy dipped 0.2 percent in October, the Conference Board said on Wednesday – falling for the third straight month.
That followed the downwardly revised 0.6 percent decline in September (originally -0.3 percent, which would have been unchanged from August).
The leading index eased in October, with downward revisions to third quarter results as data for national accounts became available. Building approvals and the sales to inventories ratio made the largest negative contributions this month.
Between April and October, the leading economic index declined 1.0 percent (about a -2.0 percent annual rate), a reversal from its increase of 1.4 percent (about a 2.9 percent annual rate) over the previous six months.
Additionally, the weaknesses among the leading indicators have become more widespread than the strengths in the recent months.
Three of the seven components in the leading index increased in October. The positive contributors to the index were share prices, yield spread, and money supply. Building approvals, the sales to inventories ratio, rural goods exports, and gross operating surplus declined in October.
The coincident index added 0.2 percent for the third straight month.
The coincident economic index grew 0.8 percent (about a 1.6 percent annual rate) in the six-month period through October, down from 1.4 percent (about a 2.8 percent annual rate) in the previous six months. Meanwhile, real GDP expanded at a 1.4 percent annual rate in the third quarter of 2014, down from 2.0 percent (annual rate) in the second quarter.
The coincident index continues to post moderate gains, but its six-month growth rate has slowed compared to the first half of the year. Taken together, the recent behavior of the composite indexes suggests that economic expansion should continue in the near term, but the pace is unlikely to pick up in early 2015.
All four components in the composite increased in October. The increases occurred in retail trade, household gross disposable income, employed persons and industrial production.
The material has been provided by InstaForex Company – www.instaforex.com