US leading indicators rise in June but recovery is slowing

21 July 2011 17:49  [Source: ICIS news]

WASHINGTON (ICIS)--A key index of US economic performance rose by 0.3% in June, the Conference Board said on Thursday, but the pace of recovery continues to slow

The Conference Board, a 94-year-old business analysis group in New York City, said that its leading economic index (LEI) rose to 115.3 last month and followed an 0.8% gain in May and a 0.3% decline in April.

The LEI represents a cumulative measure of 10 different business and economic gauges, such as manufacturers’ new orders, residential building permits, interest rates and consumer sentiment, among others.

The 0.3% improvement in June was attributed to new orders for manufactured consumer goods, an upturn in building permits and money supply. Those gains helped offset negative numbers in consumer expectations and a decline in manufacturers’ orders for nondefense capital goods.

Conference Board economist Ken Goldstein said that “The economy faced some recent unexpected headwinds, including a shortage of auto and electronic parts from Japan after the earthquake, and damaging tornado and flooding in the US”.

“Another potential headwind is the debt ceiling issue, which could result in a financial crisis in the near term if not resolved,” Goldstein added.

The leading indicators have improved more or less steadily since just before the US recession ended in June 2009, but the board noted that the pace of growth has continued to slow.

“The six-month change in the index has continued to moderate,” the board said.

In the January-June 2011 period, the LEI grew at 2.7%, the board said, a slower pace than the 3.2% rate of expansion recorded for the last six months of 2010.

Paul Hodges studies key influencers shaping the chemical industry in Chemicals and the Economy

By: Joe Kamalick
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