Iowa Leading Indicators Index nearly unchanged in May

The Iowa Leading Indicators Index (ILII), used by state officials to forecast tax revenues and the future direction of economic activity, increased 0.1% in May to 110.8 from 110.7% in April. The monthly diffusion index remained unchanged at 50.0.

During the six-month span through May, the ILII increased 0.6% (an annualized rate of 1.2%).

The six-month diffusion index remained unchanged in May at 62.5 from April and March 2022. Five of the eight component indicators increased more than 0.05% over the last half-year: agricultural futures profits index (AFPI), average weekly unemployment claims, diesel fuel consumption, the Iowa Stock Market Index and national yield spread, according to the report.

The Iowa nonfarm employment coincident index recorded a 0.18% increase in May, the fourteenth month of growth in a row.

In April, the ILII increased 0.3% compared to March.

Other notes

  • Average weekly unemployment claims was the strongest contributor to the ILII in May. The 12-month moving average of claims decreased from 2,180 to 2,021. Unemployment claims were 57.9% below May 2021 claims and 50.4% below average historical claims for May.
  • Diesel fuel consumption and yield spread went from positive contributors in April to detractors in May. Residential building permits and the Iowa Stock Market Index went from detractors to the index in April to positive contributors in May.
  • The largest detractor from the index in May 2022 was the new orders index. The May 2022 monthly value of the new orders index decreased to 56.6 from 70.6 in April, and was substantially lower than the May 2021 value of 72.7.

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