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Electricalmarketing 2978 Economic Indicators Gettyimages 912808702 1024
Electricalmarketing 2978 Economic Indicators Gettyimages 912808702 1024
Electricalmarketing 2978 Economic Indicators Gettyimages 912808702 1024
Electricalmarketing 2978 Economic Indicators Gettyimages 912808702 1024
Electricalmarketing 2978 Economic Indicators Gettyimages 912808702 1024

Electrical Marketing’s Leading Economic Indicators - November 2018

Nov. 16, 2018
Architect billings are up but other major indicators show some slippage.

AIA Billings Index remains in growth mode. Architecture firm billings growth softened in October but remained positive for the thirteenth consecutive month, according to the American Institute of Architects (AIA), Washington, DC. AIA’s Architecture Billings Index (ABI) score for October was 50.4 compared to 51.1 in September. AIA Chief Economist Kermit Baker said with continued strength in new project inquiries, billings are expected to remain steady into the coming months.

Dodge Momentum Index slides in October. The Dodge Momentum Index moved 4.2% lower in October to 150.5 (2000=100) from the revised September reading of 157.0. The Momentum Index is a monthly measure of the first (or initial) report for nonresidential building projects in planning, which have been shown to lead construction spending for nonresidential buildings by a full year. October’s shortfall was the third consecutive monthly decline and the result of losses in both components of the Momentum Index.

The commercial component fell by 4.9% from September to October, while the institutional component dropped 3.1%. The commercial component has, in fact, been the impetus behind the recent string of declines in the overall index. Dodge said this is consistent with the view that the commercial building sector is approaching a peak and should begin to gradually ease back over the coming year.

Conference Board’s Leading Indicators starting to contract. The Conference Board Leading Economic Index (LEI) for the U.S. increased 0.5% in September to 111.8 (2016 = 100), following a +0.4% increase in August, and a +0.7% increase in July. “The U.S. LEI improved further in September, suggesting the U.S. business cycle remains on a strong growth trajectory heading into 2019,” said Ataman Ozyildirim, director and global research chair at The Conference Board. “However, the LEI’s growth has slowed somewhat in recent months, suggesting the economy may be facing capacity constraints and increasingly tight labor markets. Economic growth could exceed 3.5% in the second half of 2018, but, unless the momentum in housing, orders and stock prices accelerates, that pace is unlikely to be sustained in 2019.”

Purchasing Managers Index slips in September. The Purchasing Managers Index (PMI) is one of several key economic indicators showing slippage over the past two months, although it’s still in growth territory. The October PMI registered 57.7 percent, a decrease of 2.1 percentage points from the September reading of 59.8 percent, according the Institute for Supply Management, which publishes the monthly survey of industrial purchasing managers. Any reading over 50 points reflects a positive purchasing environment.