Leading index forecasts U.S. growth
With gains for five straight months, an index forecasting economic conditions in the United States projects growth through the summer and perhaps beyond.
The Conference Board reported that its Leading Economic Indicator (LEI) advanced seven-tenths of a percent to 95.5 in February.
Separate measures of current conditions and past performance also rose.
“The consistent signal for the leading series suggests that progress on jobs, output and incomes may continue through the summer months, if not beyond,” said Ken Goldstein, an economist for the Conference Board.
“Continued broad-based gains in the LEI for the United States confirm a more positive outlook for general economic activity in the first half of 2012,” added Ataman Ozyildirim, another economist with the business research and membership group.
The LEI has climbed 1.9 percent over the past six months, topping the growth of 1.1 percent during the six months before that. Strengths among the leading indicators have become more widespread.
For February, eight of the 10 indicators of the LEI advanced, including average weekly manufacturing hours, building permits, interest rate spread, new orders for manufactured capital and consumer goods, a new orders index and stock prices. In addition, average weekly initial claims for unemployment insurance were down. Two indicators retreated: consumer expectations for business conditions and another new orders index.
The Coincident Economic Index (CEI), a measure of current economic performance, rose two-tenths of a percent in February to 104. The CEI has climbed 1.8 percent over the past six months.
For February, three of four indicators of the CEI advanced: nonfarm payrolls, personal income and sales. An index tracking industrial production held steady.
The Lagging Economic Index (LAG), a measure of past economic performance, also rose two-tenths of a percent in February. At 114.1, the index has climbed nine-tenths of a percent over the past three months.
For February, three components of the LAG advanced: consumer credit, labor costs and a decrease in the average duration of unemployment.
Three components retreated: commercial and industrial financing, inventories and labor costs. The average prime interest rate remained unchanged.