Leading indicators

The composite leading index rose by 1.0% in June, after upwardly-revised gains of 1.1% in April and May. Growth again was concentrated in the manufacturing sector. Household spending and the stock market continued to moderate, after leading the initial upturn in mid-2009.

New orders for durable goods rose 2.3%, their fifth straight gain. Demand was led by capital goods such as aerospace and machinery. The ratio of shipments to inventories continued to strengthen, although for the first time in 10 months, all of the increase originated in higher sales as inventories stopped falling. The average workweek in manufacturing posted a third straight large increase, although this has not yet been reflected in more factory jobs. An upturn in business spending was reflected in more jobs in business services, which drove the overall gain in services jobs in June.

The housing index continued to retreat, off 1.9% after a 1.7% decline in May. Existing home sales led the drop, after peaking in January. Housing starts slowed, as lower new house sales were reflected in an increase in unsold units. Consumer demand for big-ticket durable goods was mixed: furniture and appliances continued to increase, but lower auto sales led a decline for other durable goods.

Available on CANSIM: table 377-0003.

Definitions, data sources and methods: survey number 1601.

This release will be reprinted in the August 2010 issue of Canadian Economic Observer, Vol. 23, no. 8 (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.