US real GDP growth to slow to around 2% in 2025: The Conference Board

The US think tank’s leading economic index (LEI) for the United States declined by 0.3 per cent in February this year to 101.1 after a 0.2-per cent decline (revised from a 0.30-per cent drop) in January.

Overall, the LEI fell by 1 per cent in the six-month period ending February 2025, less than half of its 2.1-per cent rate of decline of over the previous six months (February-August 2024).

The LEI provides an early indication of significant turning points in the business cycle and where the economy is heading in the near term.

The US LEI continues to point to headwinds ahead, said Justyna Zabinska-La Monica, senior manager, business cycle indicators, at the think tank.

“Consumers’ expectations of future business conditions turned more pessimistic. That was the component that weighed down most heavily on the index in February. Manufacturing new orders, which improved in January, retreated and were the second largest negative contributor to the index’s monthly decline,” she said.

“On a positive note, the LEI’s six-month and annual growth rates, while still negative, have remained on an upward trend since the end of 2023, suggesting that headwinds in the economy as of February may have moderated compared to last year,” she added.

The Conference Board coincident economic index (CEI) for the country increased by 0.3 per cent in February to 114.7 after a 0.2-per cent increase in January. The CEI provides an indication of the current state of the economy.

As a result, the CEI rose by 1.2 per cent over the six-month period between August 2024 and February 2025, twice its 0.6-per cent growth over the previous six months.

The CEI’s four component indicators—payroll employment, personal income less transfer payments, manufacturing and trade sales, and industrial production—are included among the data used to determine recessions in the United States.

All these improved in February, with the largest positive contribution coming from industrial production, followed by personal income less transfer payments, manufacturing and trade sales, and payroll employment.

The think tank’s lagging economic index (LAG) for the country increased by 0.4 per cent to 119.1 in February after a 0.3-per cent rise in January.

As a result, the LAG’s six-month change turned positive, rising by 0.2 per cent between August 2024 and February 2025—a reversal of its 0.2-per cent decline from over the previous six months.

The LEI declined for the third consecutive month in February this year.

Fibre2Fashion News Desk (DS)