Leading US Economic Indicators Continue to Decline, No Longer Signaling Recession

Leading US economic indicators are still pointing to a slowdown, but are no longer signaling a recession, data from the Conference Board, a nonpartisan and nonprofit research organization, said on Tuesday. That is a positive sign for risk assets, including cryptocurrencies.

The continued decline in the LEI suggests impending headwinds for the economy. However, the six-month year-over-year change narrowed to -2.1% in July from -3.1% in June, a sign that the risk of a recession is easing.

“The LEI continues to decline month-on-month, but the six-month annual growth rate no longer signals an impending recession,” Justyna Zabinska-La Monica, senior director of business cycle indicators at the conference, said in a statement. The latest figures should reassure risk-on asset speculators. Perhaps the painful trade in stocks and cryptocurrencies is now at a higher level, given the recent market slide and the resulting bearish sentiment.

As a result, stocks fell sharply and bitcoin fell from $70,000 to $50,000. The leading cryptocurrency has since rebounded to over $60,000, according to CoinDesk data.

The chart shows that while the Conference Board’s leading indicator is trending down, the concurrent indicators, which indicate the current state of the economy, are rising alongside the lagging indicators. This is a classic sign of an economy in late expansion.