EM LATAM CREDIT: Argentina Plans to Announce Incentives to Encourage Dollar Use

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March's Conference Board leading economic index (LEI) was softer than expected at -0.7% M/M (-0.5% survey, -0.2% prior which is an upward revision from -0.3%). The coincident index rose 0.1% (0.3% prior), with the lagging index -0.1% (+0.3% prior).

• This was the weakest monthly change in the LEI since October 2023, in keeping with other indicators that appear to have been negatively impact by tariff uncertainty.
• The Conference Board release notes "the data does not suggest that a recession has begun or is about to start", though the LEI hasn't been a particularly reliable indicator of recession in this cycle, having printed in negative territory for a few years now. On a 6-month basis, the index is actually trending up from the early 2023 lows, but this doesn't offer much confidence in the outlook in and of itself.
• MNI interprets the LEI more as a manufacturing cycle indicator: it is very heavily weighted toward cyclicality in manufacturing: avg weekly  manufacturing hours (25%) and ISM New Orders (17%) are combined over 40% of the index, when added to core capital goods orders (5%) and manufacturers' new orders (consumer goods and materials, 8%).
• That being said, the biggest contributor to March's LEI drop was financial conditions (equity prices, leading credit index, spreads) for the weakest such conditions since October 2023. The accompanying chart shows MNI's grouping of contributing sectors to the LEI.