Decrease of 0.1% in CB Leading Economic Index in December

The main factors contributing to the fall were unfavorable conditions in manufacturing and a high interest rate environment.  

Highlights

• In December, the CB Leading Economic Index decreased by 0.1% compared to the previous month.
• The index faced pressure due to elevated interest rates.
• The S&P 500 is reaching new record highs as the powerful upward trend persists.  

On January 22, The Conference Board published the CB Leading Economic Index report for December, revealing a 0.1% month-over-month decline, which was less severe than the anticipated -0.3% as projected by analysts. Additionally, the index exhibited a 2.9% decrease over the six-month period spanning from June to December 2023.

The Conference Board remarked that, while six out of ten leading indicators had a positive impact on the LEI in December, these gains were outweighed by challenges in manufacturing, the high interest rate environment, and low consumer confidence.

It's worth noting that The Conference Board cited low consumer confidence, despite the recent Michigan Consumer Sentiment report indicating that Consumer Sentiment had surged to its highest level since July 2021.

Following the release of the CB Leading Economic Index report, the U.S. Dollar Index remained relatively unchanged, while Treasury yields experienced a decline, putting downward pressure on the American currency. On a broader scale, forex traders are anticipating significant catalysts.

Despite the drop in Treasury yields, gold prices retreated. Currently, gold is seeking to fall below the $2025 level. The waning demand for safe-haven assets is adversely affecting the gold market.

As the robust upward momentum persists, the SP500 is testing new record highs. The favorable report may further fortify the SP500.