Gauge of US economy increases 0.5 per cent in December, fourth straight solid gain | iNFOnews | Thompson-Okanagan's News Source

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Gauge of US economy increases 0.5 per cent in December, fourth straight solid gain

FILE - In this Dec. 4, 2014 file photo, specialist Jason Hardzewicz works on the floor of the New York Stock Exchange. The Conference Board releases its index of leading indicators for December on Friday, Jan. 23, 2015. (AP Photo/Richard Drew, File)
January 23, 2015 - 10:10 AM

WASHINGTON - An index designed to predict the future health of the U.S. economy posted a fourth straight solid gain in December.

The Conference Board said Friday that its index of leading indicators increased 0.5 per cent in December after a revised gain of 0.4 per cent in November. The index also posted solid gains in September and October after a flat reading in August.

The December increase reflected widespread strength with eight of the 10 forward-pointing indicators that make up the index showing strength.

"The short-term outlook is getting brighter and the economy continues to build momentum," said Ataman Ozyildirim, a Conference Board economist. "Still, a lack of growth in residential construction and average weekly hours in manufacturing remains a concern."

The largest positive contributors to the index were the spread in interest rates, a fall in weekly unemployment claims, consumer expectations and new orders to manufacturers for capital goods excluding aircraft.

The only negative contributor to the index in December was a drop in building permits. Average weekly manufacturing hours held steady, meaning it did not add or subtract from the overall index reading.

The economy grew by 5 per cent in the July-September quarter last year, the fastest pace in more than a decade. Economists expect that growth in the final three months was probably around 3 per cent and they are looking for growth to continue at a 3 per cent pace in 2015. If that forecast occurs, it would be the strongest annual economic growth since 2005.

News from © The Associated Press, 2015
The Associated Press

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