MW: Leading indicators rise for 7th straight month
Slow growth expected in first half of 2010, Conference Board says
By Rex Nutting, MarketWatch
WASHINGTON (MarketWatch) -- The index of leading economic indicators rose for the seventh consecutive month in October, showing that a recovery is "unfolding" in the U.S. economy, the private Conference Board said Thursday.
The leading indicators rose 0.3% in October after a 1% gain in September, the private research group said. Six of the 10 indicators were positive.
Economists surveyed by MarketWatch expected the leading index to rise 0.4%. See the MarketWatch consensus and the complete weekly economic calendar.
The index is up at a 10.2% annual pace in the last six months. Read the full report.
"The data indicate that economic recovery is finally settling in," said Ken Goldstein, economist for the Conference Board. "We can expect slow growth through the first half of 2010. The pace of growth, however, will depend critically on how much demand picks up, and how soon."
"The recovery is unfolding and economic activity should continue improving in the near term," the report said.
The index of coincident indicators was unchanged in October after a 0.1% decline in September. The coincident index has been essentially flat since June, showing how fragile the recovery is despite the 3.5% annualized growth rate in the third quarter.
The coincident indicators - payrolls, industrial output, incomes and sales - are the same four indicators used by the National Bureau of Economic Research to determine whether the economy is in a recession or is expanding.
In October, six of the 10 leading indicators improved: the interest-rate spread, stock prices, jobless claims, average hours worked in manufacturing, the real money supply, and new orders for consumer goods. Four indicators were negative: Building permits, consumer expectations, delivery times, and capital equipment orders.
The leading and coincident indexes are subject to revisions, due to more complete information becoming available. In the first estimate, three of the 10 leading indicators and two of the four coincident indicators are estimated by the Conference Board because they haven't been released yet.
