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The composite leading index rose by 1.1% in August, after a 0.6% gain in July. The increase was the largest since April 2002. Growth in the leading index usually only exceeds 1% early in the recovery from a downturn. In August, 8 of the 10 components contributed to the advance, up from 5 the month before, as the manufacturing sector joined the advance.
The housing index rose by 3.1% after sizeable gains in June and July. This is the strongest three months of growth since the spring of 1991. The upturn that began in existing home sales in March was reinforced by higher housing starts over the summer. Consumer spending for other durable goods also continued to expand, even before auto sales rose sharply in July.
The Toronto stock market continued to trend upwards for the fifth straight month. While the rally has been widespread, metals have led the gains over the summer.
The leading indicator for the United States continued to recover, up 0.7% for its third straight gain. The index had fallen steadily for nearly two years. Both housing and manufacturing turned up after prolonged slumps.
New orders for durable goods manufactured in Canada rose 8.1% as summer began, its largest gain on record following marked declines in each of the previous seven months. Transportation equipment led the gain. The ratio of shipments to inventories also rebounded after eight consecutive declines, as the drop in inventories accelerated while shipments began to level off.
Services employment remained on a steady downward trend, falling 0.2%, due to declines in both personal and business services.
Available on CANSIM: table 377-0003.
Definitions, data sources and methods: survey number 1601.
This release will be reprinted in the October 2009 issue of Canadian Economic Observer, Vol. 22, no. 10 (11-010-X, free). For more information on the economy, consult the Canadian Economic Observer.
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.
Table 1
| March 2009 | April 2009 | May 2009 | June 2009 | July 2009 | August 2009 | Last month of data available | |
|---|---|---|---|---|---|---|---|
| % change | |||||||
| Composite leading indicator (1992=100) | 215.8 | 213.8 | 213.7 | 213.6 | 214.8 | 217.2 | 1.1 |
| Housing index (1992=100)1 | 97.8 | 96.7 | 97.7 | 102.5 | 107.3 | 110.6 | 3.1 |
| Business and personal services employment ('000) | 2,917 | 2,914 | 2,914 | 2,905 | 2,898 | 2,892 | -0.2 |
| S&P/TSX stock price index (1975=1,000) | 8,759 | 8,770 | 9,047 | 9,383 | 9,915 | 10,345 | 4.3 |
| Money supply, M1 ($ millions, 1992)2 | 189,656 | 191,602 | 192,980 | 193,952 | 195,887 | 197,377 | 0.8 |
| US Conference Board leading indicator (1992=100)3 | 120.1 | 119.7 | 119.7 | 120.0 | 120.6 | 121.4 | 0.7 |
| Manufacturing | |||||||
| Average workweek (hours) | 36.5 | 36.3 | 36.5 | 36.6 | 36.6 | 36.7 | 0.3 |
| New orders, durables ($ millions, 1992)4 | 23,728 | 21,942 | 19,377 | 17,639 | 16,627 | 17,971 | 8.1 |
| Shipments/inventories of finished goods4 | 1.64 | 1.60 | 1.57 | 1.56 | 1.54 | 1.55 | 0.015 |
| Retail trade | |||||||
| Furniture and appliance sales ($ millions, 1992)4 | 2,917 | 2,881 | 2,850 | 2,825 | 2,814 | 2,809 | -0.2 |
| Other durable goods sales ($ millions, 1992)4 | 9,355 | 9,254 | 9,200 | 9,203 | 9,391 | 9,441 | 0.5 |
| Unsmoothed composite leading indicator | 210.2 | 211.9 | 217.7 | 217.1 | 217.3 | 222.1 | 2.2 |
