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Released: Tuesday, August 22, 2006

The Conference Board announced today that the leading index for Mexico declined 0.1 percent, while the coincident index increased 0.2 percent in June.

• The leading index fell slightly in June following sharp gains in the previous three months. Despite the slight decline in June, the leading index continued to grow at about a 6.0 percent annual rate. This is an improvement from earlier this year, but is still below the rapid growth of 14 percent (annual rate) through the third quarter of 2005. However, the strengths and weaknesses among the leading indicators have been balanced in recent months.
• The coincident index increased again in June, keeping it on a slightly rising trend since the beginning of 2005. At the same time, real GDP grew at a 5.7 percent average annual rate in the first half of 2006 (including a 4.5 percent rate in the second quarter), up from the 3.9 percent average rate over the previous two quarters. Despite short-term volatility, the recent behavior of the leading index suggests that the economy is likely to grow at a moderate to strong rate in the near term.