20 October 2008 19:20 [Source: ICIS news]
WASHINGTON (ICIS news)--The index of leading US economic indicators rose 0.3% in September, the Conference Board said on Monday, citing improvements in the money supply and consumer expectations for the first index gain in five months.
The New York City-based Conference Board, a 92-year-old business analysis group, noted that despite the marginal improvement in its index, “weaknesses among the leading indicators have remained widespread over the past six months”.
In addition, despite the slight gain in September’s index reading, the board said that “the economy is unlikely to improve in the near term”.
The board’s closely watched index is made up of ten economic indicators, including stock prices, interest rates, manufacturers’ orders, building permits and unemployment claims, among others.
The modest improvement in September was attributed to advances in six of the ten indicators, including real money supply, consumer expectations, the interest rate spread, supplier deliveries, manufacturers’ new orders for nondefense capital goods and manufacturers’ new orders for consumer goods and materials.
Those improvements more than offset negative contributions from decreases in building permits, stock prices, average weekly manufacturing hours and increased claims for unemployment insurance.
The board clearly did not want to read too much into September’s slight improvement, noting that its index of leading indicators has been in general decline since July 2007.
“Meanwhile, real GDP [gross domestic product] growth slowed to a 1.8% average annual rate in the first half of the year, down from an average annual rate of 2.3% in the second half of 2007,” the board noted.
“Taken together, the behaviour of the composite indexes suggests that the economy is unlikely to improve in the near term,” the board concluded.
($1 = €0.75)
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