AIER’s primary leading indicators of business cycle conditions continue to signal a recession.  The percentage of primary leading indicators appraised as expanding held at 40 this month.  It is still below 50, which indicates that a recession is likely.

One of the leaders, M1 money supply, increased by nearly $60 billion, the highest ever one-month increase.  This increase is the result of unprecedented actions by the Federal Reserve in light of the financial crisis.  Another leading indicator, initial claims for unemployment insurance, reached levels not seen since 2001 recession.

The AIER cyclical score, which is based on a purely mathematical analysis of the leading indicators, decreased from 47 last month to 43 this month.  As with the percentage of leaders expanding, a number below 50 indicates a recession is likely.

The roughly coincident indicators deteriorated further this month, with only 17 percent expanding, down from 20 last month.  This suggests that a recession has probably begun.

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