A Framework That Provides Clarity

During periods of “low visibility,” confusion reigns: for every indication of one trend, there seems to be a countertrend. The key is to glean from the collective wisdom of reliable leading indicators a clear signal that the economy is headed for a turn.

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Feb 19 2013

Is an Upturn in Corporate Debt Growth Imminent?

ECRI has just updated its U.S. Leading Credit Index (USLCrI). The value of this index lies in its ability to predict cyclical turns in nonfinancial corporate debt growth.

Despite massive Fed easing, following the earlier downturn in the USLCrI, nonfinancial corporate debt growth has been weakening since late 2011, falling to a one-and-a-half-year low in its latest reading. But, with banks easing credit standards a bit, some wonder if corporate debt growth is about to start rising, with positive implications for the broader economy.

The latest update to the USLCrI clarifies the future trajectory of nonfinancial corporate debt growth, indicating whether debt growth is likely to improve noticeably anytime soon.

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Recession in the Yo-Yo Years

ECRI March 8, 2013

Year-over-year growth in nonfarm payroll jobs has now dropped to an 18-month low, and household job growth has dropped to a 16-month low. See images and notes on the state of the business cycle. More