David Rosenberg Says 'Fascinating' How Soft Landing Narrative Is Gaining 'Upper Hand' Despite Decline In Leading Economic Index

David Rosenberg, the founder and President of Rosenberg Research & Associates Inc., has highlighted the comparison between the index of leading economic indicators as well as the notion of a soft landing that has been gaining momentum in recent times.

What Happened: The Conference Board said on Monday that its leading economic index declined 1% in December following a downwardly revised decline of 1.1% in November.

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“Fascinating how on the same day that the index of leading economic indicators slid 1.0% in December (consensus was -0.7%), making it ten down months in a row which is a sure-fire recession harbinger, that the "soft landing" narrative has gained the upper hand,” Rosenberg tweeted.

Ataman Ozyildirim, Senior Director, Economics, The Conference Board, had said the U.S. leading economic index fell sharply again in December — continuing to signal recession for the U.S. economy in the near term.

“There was widespread weakness among leading indicators in December, indicating deteriorating conditions for labor markets, manufacturing, housing construction, and financial markets in the months ahead,” he had said.

Furthermore, data released last week showed U.S. retail sales slumped in December, as inflation and rising interest rates continue to weigh on U.S. economic growth. The Commerce Department reported U.S. retail sales dropped 1.1% on a monthly basis in December to $677.1 billion, missing economist estimates of a 0.8% decline.

However, despite signs of a potential economic slowdown, widespread anticipation about the possibility of a downshift in rate hike pace by the Federal Reserve is overshadowing the emerging signs of recession.

“Sorry, folks. No soft landing. On track for 3 straight quarters of declines in real retail sales alongside 2 successive negative production numbers. Only happens in recessions,” Rosenberg tweeted last week.

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