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Friday, October 18, 2019  Spokane, Washington  Est. May 19, 1883
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News >  Nation/World

Reports Reflect Strong Economy Latest Indicators Offer Little Comfort To Investors, Economists

By Patricia Lamiell Associated Press

Economic reports released Tuesday confirmed the economy remains strong, reinforcing investors’ fears that short-term interest rates will continue to rise.

In three separate reports, a widely followed gauge of manufacturing activity showed American businesses expanded in March, the government’s key indicator of future economic activity recorded its biggest jump in a year, and construction spending posted its largest gain in 11 months.

The reports suggested that inflation may be looming just over the horizon. They provided little comfort to economists and investors who were hoping that last week’s interest-rate tightening by the Federal Reserve might be its last for a while.

“These reports continue to confirm a lot of the strength we’ve seen in the numbers that have come out recently,” said Anthony Chan, vice president and chief economist at Banc One Investment Advisors in Columbus, Ohio.

The NAPM said its index of economic activity rose to a two-year high of 55 percent in March from 53.1 percent in February, exceeding economists expectations by a full percentage point.

But the NAPM also said its index of prices paid by factories for raw materials declined to 50.9 percent in March from 55.1 percent in February, a sign that inflation remains under control.

Separately, the Conference Board, a private business research group in New York, said its index of leading economic indicators rose 0.5 percent in February, to 103.5. Economic forecasts had called for an increase of between 0.2 percent and 0.4 percent.

Finally, the Commerce Department said construction spending shot up 2.3 percent in February, the biggest gain in 11 months. But Chan shrugged off the potentially inflationary implications of that report, saying unseasonably warm weather “boosted this number up big-time.”

Wordcount: 283
Tags: business

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