The US think tank’s leading economic index (LEI) for China decreased by 0.2 per cent in August this year to 149.7, after remaining unchanged in July. The LEI declined by 1.3 per cent over the six-month period from February to August of 2024, after declining by 1.4 per cent over the six-month period between August 2023 and February 2024.

Its coincident economic index (CEI) for the country improved by 0.8 per cent in August to 149.8, following an increase of 0.7 per cent in July. The index grew by 1 per cent over the six-month period from February to August of 2024, a much slower pace than the 3.4 per cent growth rate over the previous six-month period, a release from the think tank said.

LEI provides an early indication of significant turning points in the business cycle and where the economy is heading in the near term, while CEI offers an indication of the current state of the economy.

“The China LEI decreased in August, continuing a two and a half year long downward trend. The Index remained under the pressure of persistently weak consumer confidence. Additionally, most other non-financial components contributed negatively in August including declining imports for machinery and transport equipment, a weaker manufacturing PMI [purchasing managers’ index], a lower logistics prosperity index, and less labour market demand,” said Malala Lin, economic research associate at The Conference Board.

“Although the annual and semi-annual growth rates of the index remained negative, they stabilised, suggesting that headwinds to growth persist but have not worsened. Adding to previous rounds of fiscal and monetary support, the most recent PBoC [People’s Bank of China] aggressive monetary stimulus is expected to sustain growth going forward,” she added.

Fibre2Fashion News Desk (DS)