The Conference Board Leading Economic Index® (LEI) for China increased 1.1 percent, and The Conference Board Coincident Economic Index® (CEI) for China increased 0.4 percent in March.

The Conference Board LEI for China increased sharply in March, continuing on an upward trend which started in December 2008. Floor space started and consumer expectations made the largest positive contributions this month, more than offsetting the negative contributions from PMI sub-indexes of new export orders and supplier deliveries. Despite the large gain in the leading economic index, its six-month growth rate has continued to moderate, slowing to 3.4 percent (a 7.0 percent annual rate) for the period through March 2010, down from 5.0 percent (a 10.2 percent annual rate) in the previous six months. The six-month growth rate of the leading economic index has been fluctuating around 3.0 percent since December. Despite this variability, the strengths among the leading indicators have remained very widespread in recent months.

The Conference Board CEI for China, a measure of current economic activity, also continued to increase in March. Electricity production made the largest positive contribution, offsetting a large negative contribution from retail sales. The growth rate in the coincident economic index has also moderated somewhat, to 5.9 percent (a 12.1 percent annual rate) in the six months ending in March 2010, down from 7.3 percent (a 15.2 percent annual rate) in the previous six months. Nevertheless, the strengths among the coincident indicators have remained very widespread in recent months.

Both The Conference Board LEI and The Conference Board CEI for China continue to follow upward trends. Although their growth rates have been moderating compared to 2009, the strengths among the leading and coincident indicators remain very widespread. All in all, the behavior of the composite indexes and their components suggest that while the pickup in China’s economic expansion should continue in 2010, economic activity may stabilize in coming months.

LEADING INDICATORS

Four of the six components that make up The Conference Board LEI for China increased in March. The positive contributors to the index - in order from the largest positive contributor to the smallest - include the total floor space started, the consumer expectations index, the 5000 industry enterprises diffusion index: raw materials supply index,and total loans issued by financial institutions. The PMI new export order index and the PMI supplier delivery index declined in March.

With the increase of 1.1percent in March, The Conference Board LEI for China now stands at 144.5 (2004=100). This index increased 0.4 percent in February and increased 0.8 percent in January. During the six-month span through March, The Conference Board LEI for China increased 3.4 percent, and all six components advanced (diffusion index, six-month span equals 100.0 percent).

COINCIDENT INDICATORS

Three of the five components that make up The Conference Board CEI for China increased in March. The positive contributors to the index - in order from the largest positive contributor to the smallest - include electricity production, value-added industrial production, and manufacturing employment. Retail sales of consumer goods and volume of passenger traffic declined in March.

With the increase of 0.4 percent in March, The Conference Board CEI for China now stands at 179.8 (2004=100). This index increased 1.8 percent in February and increased 1.6 percent in January. During the six-month span through March, The Conference Board CEI for China increased 5.9 percent, and all five components advanced (diffusion index, six-month span equals 100.0 percent).