Economy showing staying power
Conference Board index at highest point since 2008
LOS ANGELES – Does the economic recovery actually have legs? Long ones, according to the Conference Board, whose index of leading economic indicators (including jobless claims) continued to perk up in February in the biggest increase in nearly a year.
The index, which includes improving measures such as income and sales, was up 0.7 percent last month to 95.5 after rising 0.2 percent in January and 0.5 percent in December. That’s the most substantial advance in 11 months and the highest point since June 2008.
Fueling the uptick: a promising jobs market with the unemployment rate at a three-year low and first-time claims for jobless benefits falling last week to a four-year low, according to a Labor Department report Thursday.
Building permits are up, according to the index, as are stock prices, which late last month helped the Dow Jones industrial average close above 13,000 for the first time since the financial crisis. And the country’s consumers are spending more this year – expenditures that make up 70 percent of economic activity.
The Conference Board gauge anticipates what the economy will look like three to six months in the future. The “continued broad-based gains … confirm a more positive outlook for general economic activity in the first half of 2012,” Conference Board economist Ataman Ozyildirim said.
Consumer expectations are still muted, though, he said, as is industrial production and new orders for those factory-made goods. His colleague, economist Ken Goldstein, added that an unexpectedly warm winter may have given an added boost to spending and sentiment.
Gas prices, too, are rising, which many fear could put a damper on the good economic vibes.
“But the consistent signal,” Goldstein said, “suggests that progress on jobs, output and incomes may continue through the summer months, if not beyond.”