Leading indicators

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The leading indicator rose 0.4% in April, matching its increase in March as well as its average gain in 2006. Household spending slowed from its recent torrid pace, while manufacturing continued to recover from a prolonged slump.

For the second straight month, none of the three manufacturing components fell. New orders posted the largest gain with a 0.9% increase. Aircraft and autos led this advance. The steady growth of orders in 2007 was reflected in a rebound in manufacturing shipments, which helped stabilize the ratio of shipments to inventories. The average workweek also edged up.

Financial market conditions continued to strengthen, with the stock market setting new record highs. Prices rose across the board in April, unlike previous gains which often were concentrated in metals and energy.

Household spending was mixed. Furniture and appliance sales continued to expand steadily. Housing levelled off, largely because housing starts returned to more normal levels after receiving a boost from the unseasonably warm start to the year. Purchases of other durable goods fell for a second straight month, largely due to slower auto sales.

Available on CANSIM: table 377-0003.

Definitions, data sources and methods: survey number 1601.

For more information on the economy, consult the May 2007 issue of Canadian Economic Observer, Vol. 20, no. 5 (11-010-XWB, free), available from the Publications module of our website. A printed version (11-010-XPB, $25/$243) will be available soon.

For more information, or to enquire about the concepts, methods or data quality of this release, contact Philip Cross (613-951-9162; ceo@statcan.gc.ca), Current Economic Analysis Group.

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