Leading Indicator of Industry Profitability: September 2010

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Leading Indicator of Industry Profitability: September 2010

Industry Economic Analysis

Author: Maxim Armstrong, Michael Burt

$265.00

The outlook for corporate profitability in Canada weakened again in August, with the Leading Indicator of Industry Profitability recording its fifth consecutive month of decline. Encouragingly, the rate of decline slowed for a second month in a row. The leading indicator for all industries declined by 0.4 per cent in August, a slight improvement from the 0.5 per cent decline in July. (The index recorded its biggest drop in June, with a 0.7 per cent decline.)

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The monthly Leading Indicator of Industry Profitability is constructed from high frequency data series. The indicators are designed to be predictive of movements in corporate profitability six months hence. An industry leading index is created for the economy as a whole, as well as for 49 individual sectors within the economy, thus providing coverage for most of the private business activity that takes place in Canada.

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