The Conference Board released a report on Monday showing its reading on leading U.S. economic indicators fell by more than expected in the month of October.
The report said the leading economic index slid by 0.8 percent in October after falling by 0.7 percent in September. Economists had expected the index to decrease by 0.6 percent.
The bigger than expected drop by the index reflected deteriorating consumers’ expectations for business conditions, lower ISM Index of New Orders, falling equities, and tighter credit conditions.
“After a pause in September, the LEI resumed signaling recession in the near term,” said Justyna Zabinska-La Monica, Senior Manager, Business Cycle Indicators, at The Conference Board.
“The Conference Board expects elevated inflation, high interest rates, and contracting consumer spending-due to depleting pandemic saving and mandatory student loan repayments-to tip the U.S. economy into a very short recession,” she added.
The Conference Board said its Coincident Economic Index was unchanged in October, while the Lagging Economic Index inched up by 0.1 percent.