Last month, there was news of the U.S. Business Roundtable CEO Economic Outlook Index in Q1 2017 clocking its biggest increase since Q4 2009, and the Conference Board’s Consumer Confidence in March 2017 peaking to its highest level since December 2000. Now, the latest figures of the Conference Board’s Leading Economic Index (LEI) should add to the good news.

Even as negative headlines raised market volatility in recent weeks, signs of the U.S. economy’s solid fundamentals stay strong, as various economic indices’ recent movements suggest. Last month, there was news of the U.S. Business Roundtable CEO Economic Outlook Index in Q1 2017 clocking its biggest increase since Q4 2009, and the Conference Board’s Consumer Confidence in March 2017 peaking to its highest level since December 2000. Now, the latest figures of the Conference Board’s Leading Economic Index (LEI)   should add to the good news.

The LEI for the U.S. climbed +0.4% in March, following February’s +0.5% and January’s +0.6% increases.

The LEI is a composite index of 10 economic indicators - including those on manufacturing employment, initial jobless claims, manufacturing sector’s new orders, housing statistics, stock prices, interest rate spreads and consumer expectations, among others.

Along with Conference Board’s Coincident and Lagging indices, the LEI seeks to signal business cycle positions by combining the various economic metrics while ironing out volatility of the individual components.

Notwithstanding some decline in labor market components, the LEI for the U.S. surged ahead last month to reach 126.7 (2010=100), largely bolstered by new manufacturing orders and interest-rate spread between 10-year Treasury and the federal funds, as suggested by the  Director of Business Cycles and Growth Research of the Board. The Director has also mentioned “continued economic growth” through 2017 as a big driver of the rise in the overall index value, and has hinted at a possible acceleration later in the year if consumer spending and investment improve.

In addition, the Board’s Coincident Economic Index – measuring current economic conditions - increased +0.2% in March, following an equal percentage rise in February.

Bottom Line for Investors

Volatility may come and go, but investors need not panic as long as the fundamentals remain resilient – and they sure are for the U.S. economy, as reaffirmed by leading economic gauges such as the Conference Board’s LEI.