Local economic data is starting to be released by government organizations after the federal shutdown. I can now update the Augusta Leading Economic Index (LEI) through August! In August, the index was down 0.2% from July but remained 0.8% higher than August 2024.
Components contributing positively to the index included initial claims for unemployment insurance, the Dow Jones Industrial Average (DJIA), and job openings. Initial claims for unemployment insurance fell 44 percent in July. In August, the DJIA was amid a six-month rally that has continued at least through the end of November. Job openings in Georgia and South Carolina increased for the first time in three months.
Residential building permits and real deposits in local banks negatively impacted the index. Permits were down 8 percent while real deposits were harmed by rising inflation. Inflation in the South Census Region has increased by 0.7 percentage points since March.
The Augusta LEI has decreased for three consecutive months. Normally, the index is a reasonable leading indicator of real economic variables, such as employment, three to six months ahead. However, since the latest data is for August, it doesn’t really help business planning, given that we are now in December!
