An index forecasting economic conditions in the United States continues to signal growth through the end of the year.
The Conference Board reported its Leading Economic Index (LEI) rose six-tenths of a percent to 110.7 in July. While a separate measure of current economic performance rose, a measure of past performance declined.
“The U.S. LEI increased in July, suggesting the U.S. economy will continue expanding at a solid pace for the remainder of this year,” said Ataman Ozyildirim, director of business cycles and growth research at the Conference Board, a business research and networking association.
The LEI has increased 2.7 percent over the past six months, slower than the 3.6 percent gain over the previous six-month period. Strengths among leading indicators remain widespread, however.
Gross domestic product, the broad measure of goods and services produced in the country, grew at an annual pace of 4.1 percent during the second quarter after increasing 2.2 percent in the first quarter.
For July, nine of the 10 indicators of the Leading Economic Index advanced, including building permits, consumer expectations, interest rate spread, leading credit and new orders indexes, new orders for capital and consumer goods and stock prices. A decrease in average weekly initial claims for unemployment benefits also boosted the index. Average weekly manufacturing hours held steady.
The Coincident Economic Index, a measure of current conditions, increased two-tenths of a percent to 104.2. The index has increased 1.4 percent over the past six months.
For July, all four indicators of the index advanced: industrial production, nonfarm payrolls, personal income and sales.
The Lagging Economic Index, a measure of past performance, decreased two-tenths of a percent to 105.2. The index has increased a half of a percent over the past three months.
For June, just two of seven indicators of the index advanced — the average prime interest rate charged by banks and consumer credit. Commercial and industrial financing, inventories and labor costs declined. An increase in the average duration of unemployment also pulled down the index. The cost of services held steady.