According to the Metal Industry Indicators report released by the US Geological Survey (USGS), the steel leading index for the US decreased by 0.8 percent in May this year, the latest month for which it is available, falling to 110.6 from a revised 111.5 in April. Its six-month smoothed growth rate slipped into negative territory to -0.6 percent in May from a revised 1.1 percent in April.
The sharp decline in the S&P stock price index for iron and steel companies made the largest negative impact. In contrast, the index of new housing permits issued made a sizable positive contribution to the leading index. The USGS report points out that the steel leading index growth rate suggests that steel industry activity growth in the US is likely to decrease in the near future.
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.