Economic Watch: Latest Readings Full of Positives
A gauge of the health of the American economy has increased again, hitting its highest level in more than a decade. Meanwhile, manufacturing activity outpaced overall industrial output, consumer sentiment hit its highest level in over a decade, and homebuilding continues to trend up, according to a basket of reports issued Friday and Thursday.
The Conference Board’s Leading Economic Index (LEI) for the U.S. increased 0.6% in February to 126.2. That follows a 0.6% improvement in January and a 0.6% hike in December. The latest performance is the best since March 2006.
“After six consecutive monthly gains, the U.S. LEI is at its highest level in over a decade,” said Ataman Ozyildirim, director of business cycles and growth research at the private research group. “Widespread gains across a majority of the leading indicators point to an improving economic outlook for 2017, although GDP growth is likely to remain moderate.”
The LEI is made up of 10 components. Only housing permits contributed negatively to the LEI in February, reversing gains over the previous two months.
The gauge in February was helped out the most by strength in new orders for manufactured goods, according to analysis from Wells Fargo Securities, as well as an improving interest rate spread, which is the difference between the average yield a financial institution receives from loans and other interest-accruing activities and the average rate it pays on deposits and borrowings.
Manufacturing Shines Despite Dull Industrial Output Numbers
A separate report released Friday by the Federal Reserve showed the total output from the nation’s factories, mines and utilities was unchanged in February, lower than an advance consensus estimate from analysts.
This measure of industrial production follows a January level that showed a 0.1% decline. But the manufacturing sector improved in February for the sixth straight month, posting a 0.5% jump from January and it …Read the rest of this story
