Conference Board LEI Rise May Be Inflection Point for Europe Feb 27, 2009

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The Conference Board Leading Economic Index (LEI) for the Euro Area increased 0.5% in January to 92.8 (2004 = 100), following a 1.7% fall in December and a 1.8% drop in November.

"If sustained, the 0.5% rise in The Conference Board LEI for the Euro Area in January may signal an inflection point in the recession, but still not a turning point," said Jean-Claude Manini, Conference Board Senior Economist for Europe. "The expansionary policy mix currently in place may favor a rebound during the second half of 2009, but history suggests that the combination of traditional recessions and financial crises often lead to subdued recoveries."

Despite the increase in January, the LEI for the Euro Area remains on a general downtrend since June 2007, falling by more than 14% since then. The group said that a previous decline of this magnitude preceded the region's 1992-93 recession. Meanwhile, The Conference Board Coincident Economic Index (CEI) for the Euro Area, a measure of current economic activity, rose by 0.2% in January to 104.5 (2004 = 100), according to preliminary estimates, after falling 0.4% in December and 0.3% in November. The CEI for the Euro Area has been trending downward since February 2008.

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