DECLINING HOUSING PERMITS AFFECT U.S. LEADING INDEX

The U.S. leading index, a key barometer of economic conditions, has decreased in four of the last six months, including a 0.1 percent decline in July, The Conference Board recently reported. The index now stands at 138.1 (1996=100), one point below the high of 139.1 reached in January, but remains 0.9 percent above the level achieved a year ago.

The leading index signals slow to moderate economic growth in the coming months, according to the report.

Since January, declining housing permits have been the largest negative contributor to the leading index.

The coincident index, a measure of current economic activity, increased 0.2 percent to 123.1 in July, while the lagging index, a reflection of past economic activity, fell 0.1 percent to 123.7, according to the report.

**Taken from the California Association of Realtors Bulletin, dated August 23rd, 2006.