US leading indices slide

In the chart below, I show my US shorter-leading index and my US diffusion index.  The shorter-leading index is made up of time series which turn just a few months before the overall economy turns.  The diffusion index shows the percentage of the measured sample of time series which is rising.  A diffusion index tends to lead the underlying economy up and down.  As long as it is above 50%, the economy is still expanding, but the higher it is above 50%, the faster the economy is expanding.

These two indicators suggest that US economic growth is slowing.  They don't say how deep the recession will be, or whether it might even just be a "soft landing".   But they confirm that a slowdown is taking place.  The rise in commodity prices and inflation suggest a "hard landing", but that is still many months away.  In the meantime,  my shorter-leading and diffusion indices confirm that the trend is definitely down, though the economy is still expanding, slowly.