The index of U.S. leading economic indicators rose more than forecast in May, propelled by a jump in home-building permits.
The Conference Board’s gauge of the outlook for the next three to six months increased 0.3% after a 0.1% drop in April, the New York-based group said today. Economists projected the gauge would rise by 0.1%, according to the median estimate in a Bloomberg News survey.
A labor market that’s lost momentum and more cautious spending among businesses are keeping economic growth from gaining speed. The Federal Reserve pledged yesterday to undertake further action to lower interest rates as a means of spurring growth.
Estimates from 47 economists in the Bloomberg survey ranged from a decrease of 0.3% to an increase of 0.4%.
Seven of the 10 indicators in the leading index contributed to the increase, led by a pickup in home-building permits, which contributed 0.21 percentage points to the gain, and the spread between the Treasury 10-year note and the federal funds rate.
The Conference Board’s index of coincident indicators, a gauge of current economic activity, rose 0.2% for a second month.
The coincident index tracks payrolls, incomes, sales and production -- the measures used by the National Bureau of Economic Research to determine the beginning and end of U.S. recessions.
The gauge of lagging indicators increased 0.3% following a 0.6% advance in April.
Economic growth that’s cooling globally, alongside fears the European financial crisis could worsen, have sent stock prices lower. The Standard & Poor’s 500 Index dropped 6.3% in May, the worst monthly decline in six months.
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