Leading economic index revised down

The Cabinet Office on Friday revised downward its assessment for the future course of the economy as of August, but upgraded the evaluation of the economy’s current state.

The index of leading indicators, which gauges economic movements about six months down the road, came to 40 percent in the revised report, down from the 44.4 percent recorded in an initial report Oct. 7.

The office attributed the revision to a fall in core machinery orders, a leading gauge of capital investment.

The revised report confirms that the diffusion index of leading economic indicators slipped below the boom-or-bust line of 50 percent in August for the first time in eight months.

The index of coincident indicators, meanwhile, was revised upward to 80 percent from a preliminary 77.8 percent, on the basis of a rise in capacity utilization rates in the manufacturing sector. The coincident index was above 50 percent for the seventh straight month.

The index of lagging indicators, measuring performance in the recent past, was left unchanged at 50 percent. The lagging index scored 50 percent for the second successive month, having fluctuated around this mark since April.

The diffusion indexes of the coincident, leading and lagging indicators compare the current levels of various economic indicators with their respective levels three months earlier.