Leading Indicator Rises in September

Leading Indicator Rises in September

The Leading Economic Index® for Brazil (LEI), published by FGV IBRE in partnership with The Conference Board (TCB), rose 1.2 percent in September to 121.9, 1.9 points above the pre-pandemic level of 120 in February 2020. The six month change in the index was 8.6 percent. Of the eight components that comprise the index, four contributed positively, with the largest contribution coming from the Manufacturing Survey’s Expectations Index.

The Coincident Economic Index for Brazil (CEI) (FGV IBRE / TCB), which measures current economic conditions, remained unchanged at 103.9 points in the same period. The six month change was also positive at 1.8 percent.

“The balance of risk between health and production has been moving in a favorable direction towards the continuity of economic recovery, as is clearly reflected in the components of the LEI connected with expectations.” according to Paulo Picchetti of FGV IBRE. “CEI performance in recent months shows that the worst has passed, but that the pace of recovery is still more evident in expectations than in the current indicators.” adds Picchetti.

The Leading Economic Index aggregates eight components that measure economic activity in Brazil. Each has proved individually efficient in anticipating economic trends. Aggregating individual indicators into a composite index filters out so-called "noise”, smoothing out the volatility of individual components, and revealing the underlying economic trend.

About the Leading Economic Index (LEI)
FGV IBRE and The Conference Board launched the Leading Economic Index (LEI) for Brazil in July 2013. With a series dating back to 1996, the LEI would have reliably anticipated all four recessions identified by the Brazilian Dating Committee of Economic Cycles (CODACE) during this period. This indicator allows Brazil to directly compare its business cycles with 11 other countries and regions already covered by The Conference Board: China, the United States, the Eurozone, Australia, France, Germany, Japan, Mexico, Korea, Spain and the UK.

The eight components of the Brazilian LEI are:

Pre-fixed DI swap reference rate – 1 year (Source: Brazilian Central Bank)
Ibovespa Stock Market Index (Source: BOVESPA - São Paulo Stock Exchange)
Manufacturing Expectations Index (Source: FGV IBRE)
Services Expectations Index (Source: FGV IBRE)
Consumer Expectations Index (Source: FGV IBRE)
Durable consumer goods - physical production index (Source: IBGE – Brazilian Institute of Geography and Statistics)
Terms of trade index (Source: FUNCEX – Center for Foreign Trade Studies Foundation)
Exports Quantum Index (Source: FUNCEX - Center for Foreign Trade Studies Foundation)


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Created in 1944, FGV is a Brazilian private higher education institution, think tank, and producer of statistics, with a mission "to foster Brazil’s socioeconomic development”. The Brazilian Institute of Economics (IBRE) is FGV´s arm with the mission to produce and disseminate high-quality economic statistics and studies that are relevant to improving policies and private action in Brazil. www.fgv.br/ibre