22 July 2010 16:56 [Source: ICIS news]
WASHINGTON (ICIS news)--The index of US leading economic indicators (LEI) fell by 0.2% in June from May, the Conference Board said on Thursday, noting that this second decline in three months is another sign that the nation’s recovery is slowing.
The Conference Board, a 94-year-old business analysis group in New York City, said that with the June decline, the six-month change in its leading economic index has slowed to 2.6%, down from the 5.6% rate of change seen in the second half of 2009 when the recovery was just getting started.
The modest 0.2% decline in LEI index in June followed a 0.5% gain in May and a slim 0.1% fall in April - the first downturn in a year.
“The indicators point to slower growth through the fall,” said board economist Ken Goldstein.
The board’s index of leading economic indicators was comprised of 10 subsidiary measures of commercial activity, including average weekly hours of manufacturing, weekly claims for unemployment benefits, manufacturers’ new orders, private housing building permits and consumer expectations.
The index was pulled down in June by a decline in manufacturing hours, a fall in supplier deliveries, new unemployment claims and a downward trend in stock prices.
The index stood at 109.8 and was nearly three points higher than the previous peak of 107, which was reached just before the recession began in December 2007.
In addition, said board economist Ataman Ozyildirim, “the gains among the LEI components have been widespread, with the exception of housing permits and stock prices, pointing to an expanding economy, but at a slower pace in the second half of the year”.
But the decline in the closely watched Conference Board index came following other worrisome economic data sets, including a 5% drop in housing starts in June and a second dose of declining retail sales set in the same month.
Federal Reserve Board Chairman Ben Bernanke triggered a sharp downturn on Wall Street on Wednesday when he told Congress that the nation’s recovery looks weaker, and the chief White House economic advisor cautioned that the economy still faces headwinds.
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