Global Leading Indicators

The Conference Board Leading Economic Index^®(LEI) for India decreased by 0.5 percent in January 2023 to 149.6 (2016=100), following an identical decline in December 2022. However, the LEI improved by 1.4 percent in the six-month period from July 2022 to January 2023, which was slower than the 4.8 percent growth over the previous six months.

The Conference Board Coincident Economic Index^® (CEI) for India decreased by 2.3 percent in January 2023 to 138.6 (2016=100), following a 1.8 percent decrease in December 2022. The CEI decreased by 7.8 percent in the six-month period from July 2022 to January 2023, a sharp slowdown from the 13.8 percent increase in the six-month period from January to July 2022, which reflected a rapid rebound from the pandemic induced slowdown in 2021.

“The LEI for India decreased in January, suggesting weakening economic growth in the coming months,” said Andrew Dearborn, Economic Research Assistant at The Conference Board. “The LEI for India points to continued headwinds as 2023 begins. While nearly all components contributed negatively, the spread between the 10 year and 3-month government bond yields was the only component to contribute positively (the yield spread often signals a recession when it becomes negative). The recent trajectory of the LEI reflects downside risks such as persistently high inflation, declining international demand in the face of a depreciating currency, and recessions in developed markets, which could weigh on economic growth in India. The Conference Board projects year-over-year real GDP growth will slow to 5.4 percent in 2023, from 7.1 in 2022.”

The India LEI declined in January, pointing to downside risks to growth in the short term

Nearly all components contributed negatively in January, a change from the mixed performance of the past 6 months

The trajectory of the LEI points to slowing economic growth in 2023

About The Conference Board Leading Economic Index^® (LEI) for India: The composite economic indexes are the key elements in an analytic system designed to signal peaks and troughs in the business cycle. The indexes are constructed to summarize and reveal common turning points in the economy in a clearer and more convincing manner than any individual component. The CEI is highly correlated with real GDP. The LEI is a predictive variable that anticipates (or “leads”) turning points in the business cycle by around 1 months. Shaded areas denote recession periods or economic contractions. The dates above the shaded areas show the chronology of peaks and troughs in the business cycle.

The eight components of The Conference Board Leading Economic Index^® for India include: Interest rate spread, BSE: Index, REER: 40 Currencies, M3: Bank Credit to Commercial Sector      , Merchandise Exports, Cargo Handled, IP-Capital Goods, and India PMI: Services Business Activity.

To access data, please visit: https://data-central.conference-board.org/

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