US leading indicators suggest more growth, jobs in near term

22 August 2013 18:02  [Source: ICIS news]

WASHINGTON (ICIS)--The US economy should develop more strength in the remaining months of this year and jobs growth is expected to improve as well, a major business survey reported on Thursday.

The Conference Board said that its leading economic index (LEI) rose by 0.6% in July to 96.0, an improvement over a flat performance in June and May’s more narrow 0.3% gain.

The board’s LEI is set against a baseline of 100 established in 2004.

The leading economic index 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 LEI has seen more or less steady improvement since the Great Recession ended in June 2009, although it experienced a multi-month drop in late 2011 before resuming its upward climb.

Conference Board economist Ataman Ozyildirim said that “Following moderate growth in the last few months, the US LEI picked up in July, with widespread gains among its components”.

“The pace of the LEI’s growth over the last six months has nearly doubled,” he said, “pointing to a gradually strengthening expansion through the end of the year.”

Ken Goldstein, another board economist, said that the July advance in the LEI and an improvement in the index’s six-month growth rate “suggest better economic and job growth in the second half of 2013”.

But Goldstein also cautioned that big uncertainties cloud the outlook, including hesitancy in business spending and the potential impact of slower global growth on US exports.

The Conference Board is a 96-year-old business analysis group based in New York City.

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

By: Joe Kamalick
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