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Leading indicators

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October 2009 (Previous release)

The composite leading index increased 0.7% in October, its fourth straight advance. In October, 8 of the 10 components expanded, the same as in September. Housing remained the fastest-growing component. While the US leading indicator continued to recover, this has been slow to translate into higher demand for factories in Canada.

The housing index rose 4.2%, its sixth straight increase. The initial upturn was led by existing home sales. While sales recently have slowed, housing starts have accelerated, up 4.8% in October. The other components of consumer spending posted moderate growth of about 0.5%. For furniture and appliances, this represents their largest advance since September 2008. Outlays for other durable goods rose for the fourth month in a row, even before auto sales accelerated in October.

The US leading indicator rose by 0.9%, surpassing the growth of the Canadian leading index. Industrial demand, notably autos, and housing led the increase in the United States.

Despite the improvement in the US economy, demand for Canadian manufactured goods remained uneven. New orders fell for a second straight month. The ratio of shipments to stocks edged up, but only because inventories fell faster than sales. The increase in the average workweek slowed, after two months of acceleration. Still, at 37.3 hours, the workweek remains a full hour longer than its record low set in April.

The stock market rally slowed to 1.0% growth last month, after the smoothed version rose by an average of 4% over the previous five months.

Available on CANSIM: table 377-0003.

Definitions, data sources and methods: survey number 1601.

This release will be reprinted in the December 2009 issue of Canadian Economic Observer, Vol. 22, no. 12 (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

Leading indicators
  May 2009 June 2009 July 2009 August 2009 September 2009 October 2009 Last month of data available
              % change
Composite leading indicator (1992=100) 213.8 213.9 215.4 218.3 220.9 222.4 0.7
Housing index (1992=100)1 98.0 102.9 108.4 112.5 117.6 122.5 4.2
Business and personal services employment ('000) 2,913 2,904 2,896 2,890 2,879 2,868 -0.4
S&P/TSX stock price index (1975=1,000) 9,047 9,383 9,915 10,345 10,759 10,867 1.0
Money supply, M1 ($ millions, 1992)2 193,037 193,999 195,924 198,081 200,123 202,216 1.0
US Conference Board leading indicator (1992=100)3 119.7 120.0 120.5 121.5 122.6 123.7 0.9
Manufacturing              
Average workweek (hours) 36.5 36.6 36.7 36.9 37.2 37.3 0.3
New orders, durables ($ millions, 1992)4 19,504 17,882 16,943 18,510 17,884 17,093 -4.4
Shipments/inventories of finished goods4 1.58 1.56 1.55 1.56 1.58 1.59 0.015
Retail trade              
Furniture and appliance sales ($ millions, 1992)4 2,850 2,825 2,813 2,806 2,808 2,821 0.5
Other durable goods sales ($ millions, 1992)4 9,200 9,201 9,392 9,442 9,532 9,592 0.6
Unsmoothed composite leading indicator 217.9 218.0 218.7 224.9 224.8 225.5 0.3
Composite index of housing starts (units) and house sales (multiple listing service).
Deflated by the Consumer Price Index for all items.
The figures in this row reflect data published in the month indicated, but the figures themselves refer to data for the month immediately preceding.
The figures in this row reflect data published in the month indicated, but the figures themselves refer to data for the second preceding month.
Difference from previous month.