Newsmax TV & Webwww.newsmax.comFREE - In Google Play
Newsmax TV & Webwww.newsmax.comFREE - On the App Store
Tags: economy | Leading | Indicator | Conference Board

Index of Economy's Health Increases More Than Forecast

Thursday, 19 December 2013 11:01 AM EST

The index of U.S. leading indicators rose more than forecast in November, a sign the economic expansion will gain traction in the months to come.

The Conference Board’s index, a gauge of the outlook for the next three to six months, increased 0.8 percent last month after rising 0.1 percent in October, the New York-based group said. The median forecast of economists surveyed by Bloomberg called for an advance of 0.7 percent.

Rising stock prices, a firming housing market and gains in the labor market are helping to boost spending among households, whose balance sheets have improved over the last four years. Fading fiscal drag from federal spending cuts in 2014 will also lift growth, supporting demand as the recovery accelerates.

Editor’s Note: Pastor Explains His Biblical Money Code for Investing

“The economy is generating more momentum, that’s the bottom line,” Ward McCarthy, chief financial economist at Jefferies LLC, said in an interview before the report. “ We have steadily seen the economy grow faster over the course of 2013, and that suggests that the economic expansion is getting more strength.”

Estimates from 49 economists in the Bloomberg poll ranged from gains of 0.2 percent to 0.9 percent.

Eight of the 10 components of the leading indicators contributed to the increase, led by a drop in jobless claims and a widening spread between short- and long-term interest rates.

Gaining Momentum

“November data reflect a U.S. economy that is expanding modestly,” Ken Goldstein, an economist at the Conference Board, said in a statement. The index has been “signaling for some time that the economy is developing forward momentum, and will continue to strengthen through early 2014.”

The Conference Board’s index of coincident indicators, a gauge of current economic activity, rose 0.4 percent in November, the biggest advance since February, after a 0.1 percent gain the prior 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 recessions.

The labor market showed signs of improvement last month, with employers adding 203,0000 workers to payrolls after a revised 200,000 gain in October, Labor Department data showed Dec. 6.

More Claims

Another report today showed claims for jobless benefits unexpectedly rose last week, reflecting the typical volatility seen during the year-end holidays. The number of applications for unemployment insurance payments climbed by 10,000 to 379,000, the most since the end of March.

The gauge of lagging indicators was unchanged in November after a 0.3 percent increase the previous month.

Gains in the housing and stock markets have also supported the economic expansion. The Standard & Poor’s 500 Index climbed 2.8 percent in November in a third straight month of gains. The index is up 27 percent this year through Wednesday.

At the same time, homebuilder confidence is rising as housing demand survives an increase in mortgage rates. The National Association of Home Builders/Wells Fargo builder sentiment gauge advanced to 58 this month, matching the highest level since November 2005.

A measure of current housing demand climbed to the highest since December 2005, while gauges of sales prospects and buyer traffic picked up, indicating the industry will be a source of strength for the economy next year.

Budget Deal

Growth in the economy may also get an extra boost next year as fiscal drag fades. U.S. lawmakers this week passed a budget accord that eases $63 billion in automatic spending cuts over two years.

Another report today showed sales of previously owned homes declined for the third consecutive month in November to the lowest level of the year as rising mortgage rates and a limited supply of properties discouraged buyers.

Purchases dropped 4.3 percent to a 4.9 million annual rate, the National Association of Realtors reported. The median forecast of economists in a Bloomberg survey called for the pace to slow to 5.02 million. The group still projects 2013 will be the best year for the industry in seven years, with an estimated 5.1 million properties sold.

Editor’s Note: Pastor Explains His Biblical Money Code for Investing

© Copyright 2022 Bloomberg News. All rights reserved.

The index of U.S. leading indicators rose more than forecast in November, a sign the economic expansion will gain traction in the months to come.
economy,Leading,Indicator,Conference Board
Thursday, 19 December 2013 11:01 AM
Newsmax Media, Inc.

Sign up for Newsmax’s Daily Newsletter

Receive breaking news and original analysis - sent right to your inbox.

(Optional for Local News)
Privacy: We never share your email address.
Join the Newsmax Community
Read and Post Comments
Please review Community Guidelines before posting a comment.
Get Newsmax Text Alerts

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

© Newsmax Media, Inc.
All Rights Reserved
© Newsmax Media, Inc.
All Rights Reserved