US leading economic index potentially signalling a recession in August

An often-cited measure of economic growth slipped unexpectedly last month, potentially pointing to a recession, a leading business lobby group said.

The Conference Board's index of leading economic indicators declined at a month-on-month pace of 0.3% in August (consensus: 0.0%).

That was on top of a one tenth of a percentage point revision to July's drop from 0.4% to -0.5%.

According to Ataman Ozyildirim, Senior Director, Economics, at The Conference Board: "the US LEI declined for a sixth consecutive month potentially signaling a recession."

"Among the index's components, only initial unemployment claims and the yield spread contributed positively over the last six months—and the contribution of the yield spread has narrowed recently."

Ozyildirim also highlighted the fall in the length of the average workweek in manufacturing in four out of the last xis months, saying it was "notable" because companies cut hours before shrinking their workforce.

Indeed, on the back of Federal Reserve's "rapid" tightening of monetary policy the Conference Board was forecasting a recession in coming quarters.