A monthly index forecasting economic performance in the United States has increased, signaling continued growth into next year.
The Conference Board reported that its Leading Economic Index rose six-tenths of a percent to 124.1 in October. Separate measures of current and past economic performance also increased.
“Despite lackluster third quarter growth, the economic outlook now appears to be improving. While the U.S. LEI’s six-month growth rate has moderated, the U.S. economy remains on track for continued expansion heading into 2016,” said Ataman Ozyildirim, an economist with the Conference Board, a business research and membership association.
The Leading Economic Index has increased 1.6 percent over the past six months, slower than the 1.9 percent gain during the previous six-month span. Strengths among components of the index have remained widespread, however.
Gross domestic product, the broad measure of goods and services produced in the country, increased at an annual rate of 1.5 percent during the third quarter after a 3.9 percent gain in the second quarter.
For October, nine of the 10 components of the Leading Economic Index advanced, including average weekly manufacturing hours, building permits, consumer expectations for business conditions, interest rate spread, a leading credit index, new orders for capital and consumer goods and stock prices. A decrease in average weekly initial claims for unemployment insurance also bolstered the index. A new orders index was the only indicator to retreat.
The Coincident Economic Index, a measure current performance, rose two-tenths of a percent to 113. The index has increased nine-tenths of a percent over the past six months.
For October, three of four components of the index increased: payrolls, personal income and sales. Industrial production declined.
The Lagging Economic Index, a measure of past performance, also rose two-tenths of a percent to climb to 119.3 The index has gained a full percentage point over the past three months.
For October, five of seven components increased, including commercial and industrial financing, consumer credit, cost of services, labor costs and inventories. An increase in the average duration of unemployment pulled down the index. The average prime rate charged by banks remained unchanged.