Leading indicators

The composite index rose 0.8 % in February after a 0.7% advance in January. In February, 9 of the 10 components rose, up from 8 in January. Household demand again led the increase, while manufacturing continued to recover.

The housing index accelerated to 1.7% growth, after slowing over the previous four months. However, all of the increase originated in higher housing starts, as existing home sales fell for the first time since February 2009. The sustained gains in housing were reflected in a 1.2% increase in sales of furniture and appliances, their largest advance in over three years. Spending on other durable goods rose 0.7%, their eighth straight increase. Personal services again led the gain in the services employment component.

The leading indicator for the United States grew 0.8%, matching the ninth straight increase for Canada. Consumer confidence has been slower to recover than in Canada, as jobs have lagged in the United States. Instead, growth has been led by the spread in interest rates and the index of supplier deliveries.

With the US economy continuing to rebound, manufacturing orders and sales rose in Canada. New orders increased for the third time in four months. The ratio of shipments to inventories posted a seventh straight gain, as sales expanded while stocks fell. The average workweek in manufacturing was the only component to decline.

Available on CANSIM: table 377-0003.

Definitions, data sources and methods: survey number 1601.

This release will be reprinted in the April 2010 issue of Canadian Economic Observer, Vol. 23, no. 4 (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.