Short-leading indicators for the US and global economy continue to show very strong signals mainly driven by low credit spreads and strong stock market performance.  In the past two months, we have seen a clear break-out of short-leading global indicators which is indicative of ongoing very loose and accommodative financial conditions.

050313_Short leading us

The ongoing upturn in leading indicators is supportive of the recent strong data in the US (PMI print, coincident index etc) and suggests that the data will improve to yield a strong 1Q13. The main point though is that risk assets may already have priced in such an economic improvement.