April 2017: ECRI’s WLI Growth Index Continues To Slow

ECRI’s WLI Growth Index which forecasts economic growth six months forward remains in positive territory for over one year – after spending the previous 35 consecutive weeks in negative territory. This is compared to RecessionAlerts similar weekly leading index. ECRI also released their lagging index this week.

Analyst Opinion of the trends of the weekly leading indices

Both ECRI’s and RecessionAlerts indicies are indicating moderate growth six months from today. Both indices are in a growth cycle but show the rate of growth slowing. They are indicating conditions 6 months from today should be somewhat better than today.

Current ECRI WLI Level and Growth Index:

Here is this week’s update on ECRI’s Weekly Leading Index (note – a positive number indicates growth):

U.S. WLI Slips

The U.S. Weekly Leading Index (WLI) slips to 143.2 from 144.1. The growth rate edges down to 5.9% from 6.5%.

To put the economy in perspective please see links below:

– read Lakshman Achuthan’s presentation ‘”America First” in Perspective’ at the Minsky Conference.

– watch Lakshman Achuthan’s interview on Reuters.

For a closer look at recent moves in the U.S. Weekly Leading Index, see the chart below:

Comparison to RecessionAlert Weekly Indicator

RecessionAlert also produces a weekly forward indicator using different pulse points that ECRI’s WLI. Here is a graph from dshort.com which compares the two indices. Both indices are showing nearly the same rate of growth.

Coincident Index:

ECRI produces a monthly coincident index – a positive number shows economic expansion. The March index value (issued in April) shows the rate of economic growth improved.

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ECRI produces a monthly inflation index – a positive number shows increasing inflation pressure.

U.S. Future Inflation Gauge:

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U.S. Future Inflation Gauge Near 8 3/4 year high

U.S. inflationary pressures were down in March, as the U.S. future inflation gauge decreased to 113.2 from a 113.5 reading in February, according to data released Friday morning by the Economic Cycle Research Institute.

“While the USFIG dipped in March, it remains in a cyclical upswing,” ECRI Chief Operations Officer Lakshman Achuthan said in a release. “In essence, underlying inflation pressures are still elevated.”