Conference Board Hopeful for Growth as LEI Rises Again

The New York-based Conference Board said Thursday its Index of Leading Economic Indicators, a key gauge of future U.S. economic activity, rose 0.3% in June, the third increase in a row, and hinted that the economy may be poised for moderate growth by late summer.

Conference Board economist Ken Goldstein said that although the overall economy remains fragile, "there appears to be enough economic demand to end the slide in industrial production."

This would be good news for trucking companies because manufacturing is one of their largest and most important customers.

However, the Philadelphia Federal Reserve Bank said Thursday that its general economic index fell to -12.2 in July from –3.7 in June, the eighth straight month that manufacturing activity declined in the Delaware, eastern Pennsylvania and southern New Jersey area.

Although the report seems to show the manufacturing slowdown is not over, the regional bank said that the six-month outlook remained upbeat.

In another report, the Labor Department said that the number of workers filing new claims for state unemployment benefits dropped last week by 35,000 to 414,000. However, the four-week moving average, which smoothes out volatility, rose to 414,500 from 412,000.

Bloomberg noted that the LEI index reflects many analysts' opinions that tax rebates and lower interest rates will help give the economy a small boost by the end of the year.

According to the Associated Press, analysts were expecting only a 0.2% rise. The index now stands at 109.6, after increasing 0.5% to 105.3 in May.

Five of the 10 components that make up the leading indicators index increased last month: money supply, vendor performance, interest rate spread, average weekly initial claims for unemployment insurance and index of consumer expectations.

The negative contributors to the index were stock prices, building permits, average weekly manufacturing hours and manufacturers' new orders for nondefense capital goods.

Manufacturers' new orders for consumer goods and materials held steady last month.

The Conference Board is a nonprofit research and business group, with more than 2,700 corporate and other members around the world.

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