26 March 2013 18:49 [Source: ICIS news]
WASHINGTON (ICIS)--A key measure of chemicals sector activity suggests a continuing if slow US economic recovery through the rest of this year with the prospect of faster expansion in 2014, the American Chemistry Council (ACC) said on Tuesday.
The three-month moving average also shows a 2.9% advance over March 2012, the report said.
The March gain in the CAB marks the eighth consecutive month of improvement.
The CAB combines data from a range of chemicals and sectors, including production of chlorine and other alkalies, pigments, plastic resins and other basic industrial chemicals.
The barometer also factors in chemical company stock data, hours worked in chemicals manufacturing and publicly available chemicals pricing and inventories. Broader data sets, such as housing starts and new orders for general manufactured goods, also are included, according to the ACC.
ACC chief economist Kevin Swift said the March CAB shows “positive gains in four broad areas: production indicators, equity prices, product prices and inventories”. All are “encouraging signs for the health of the US economy”, he added.
Swift said that while the US recovery is continuing, its pace appears to have slowed.
“We are beginning to see a slower year-over-year comparison” in the CAB data, he said.
“But overall the chemical activity barometer continues to signal an expanding US economy through 2013, with the possibility of accelerated growth in 2014 and beyond,” he said.
Part of the CAB’s improvement was laid to the ongoing if bumpy recovery in the US housing sector, but Swift indicated that growth in the new home construction market might slow a bit.
“While rising activity continues in construction-related coatings, pigments and plastic resins – supporting a continued recovery in the housing sector – we anticipate that recovery to begin a more slow progression,” he said.
Earlier on Tuesday, the Commerce Department reported that sales of new single-family homes fell in February, the second monthly decline in the last three months.
Paul Hodges studies key influencers shaping the chemical industry in Chemicals and the Economy
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