Skip to content

U.S. leading indicators up in March for 9th straight month

NEW YORK — A private research group said U.S. economic growth should strengthen by summer, but cautioned that consumer concerns over rising gas and food prices could drag on the expansion.

NEW YORK — A private research group said U.S. economic growth should strengthen by summer, but cautioned that consumer concerns over rising gas and food prices could drag on the expansion.

The Conference Board said Thursday that its index of leading economic indicators rose 0.4 per cent in March. The index, which is a measure of future economic activity, has increased for nine straight months.

Growing demand for U.S. manufactured goods and a rebound in requests for building permits helped drive last month’s gains. Six of the index’s 10 components rose. The index rose 1.0 per cent in February, revised higher from the initial estimate of 0.8 per cent.

The leading indicators began moving sharply higher last fall, coinciding with a decline in the unemployment rate and a stock market rally.

Still, the trade group said one of the components of its index — a consumer confidence survey — tumbled to a two-year low last month. The primary reason for the decline is that many people are increasingly worried about inflation.

Consumers are spending more, but the rise in costs for basic necessities could force them to spend less on discretionary goods. That could slow economic growth. Consumer spending accounts for 70 per cent of economic activity.

Gasoline jumped 5.6 per cent last month and has risen nearly 28 per cent in the past year, the government reported last week. Consumers paid an average price of $3.84 a gallon ($1.01 a litre) nationwide on Thursday, according to the travel group AAA. That’s up $0.30 from March and nearly $1 from a year ago

The government also said that retail food prices rose 0.8 per cent in March, the largest increase in almost three years. Consumers paid more for fruits and vegetables, dairy products, chicken and beef.

The Conference Board, a private research group based in New York, compiles data that has mostly already been released about real estate, manufacturing, employment, consumer confidence and financial markets. It uses that data to calculate the leading indicator index. The Conference Board also includes its own estimates about manufacturers’ new orders and the country’s money supply.