According to the Metal Industry Indicators report released by the US Geological Survey (USGS), the steel leading index for the US decreased by 0.4 percent in February this year, the latest month for which it is available, falling to 111.8 from a revised 112.2 in January. Its six-month smoothed growth rate decreased to 2.2 percent in February from a revised 3.2 percent in January.
The resumption of the decline in the inflation-adjusted M2 money supply growth rate, after a brief surge in January, a shorter average workweek in iron and steel mills and a lower PMI pulled down the steel leading index in February. However, increased car and light truck sales and a higher index for new housing permits offset some of those declines. The USGS report points out that the steel leading index growth rate still suggests that the steel industry activity could continue to grow in the near term.
Note: Composite coincident indexes for the metal industries consist of indicators for production, shipments, and total employee hours worked. A growth rate above +1.0 percent is usually a sign of an upward near-term trend for future metals activity, while a growth rate below -1.0 percent indicates a downward trend.