Economy shows growth

NEW YORK — The number of new people signing up for jobless benefits dropped last week and a closely watched gauge of future economic activity rose more than expected in May, suggesting the U.S. economy can continue a sturdy expansion through the summer.

In another sign of a broadening recovery, the Labor Department’s Producer Price Index, a measure of prices before goods reach store shelves, posted the largest increase in more than a year.

While that raised some concerns about inflation, it also indicated that businesses more confident in the economy’s growth are able to raise wholesale prices.

The Labor Department reported Thursday that new applications filed for unemployment insurance fell a seasonally adjusted 15,000 to 336,000, the lowest level since May 8.

Meanwhile, the Conference Board said its Composite Index of Leading Economic Indicators increased 0.5 percent to 116.5 in May following a 0.1 percent rise in April.