The leading index only typically exceeds one during the early stages of economic recovery, Statistics Canada says. The index slowed to 0.7 per cent in October after two months above one. (Canadian Press)

The national composite leading index rose by 0.7 per cent in October, the fourth straight monthly increase, Statistics Canada revealed Thursday.

A closely watched economic indicator, the index comprises 10 cyclical economic components that together represent all major categories of gross domestic product growth. It's seen as a broad indicator of the economic direction the country is headed in.

Growth in the leading index usually only exceeds one per cent in the early stages of recovery from a downturn. The index was above one in August and September.

Eight of the 10 components of the index advanced in October, Statistics Canada noted. That's the same number that were positive during the previous month.

The housing index rose 4.2 per cent, its sixth straight monthly increase. The initial upturn was led by existing home sales, and while sales recently have slowed, housing starts have accelerated, up 4.8 per cent in October.

Other components of consumer spending posted moderate growth of about 0.5 per cent. For furniture and appliances, it represents their largest advance since September 2008. Outlays for other durable goods rose for the fourth month in a row, even before auto sales accelerated in October.

The rally in the index's stock market component slowed to one per cent growth last month, after the smoothed version rose by an average of four per cent over the previous five months.

The U.S. leading indicator rose by 0.9 per cent, surpassing the growth of the Canadian leading index. Industrial demand, notably autos, and housing led the increase in the United States.