Mixed signals on US economy; LEI rises but job market down

The US Leading Economic Indicators (LEI) rose in July for a fourth consecutive month, though at a slower pace, a private research group said yesterday.

 However, fuelling concerns, the figures from the Labour Department showed that the jobless claims were on the rise as initial filings jump to 576,000 for the week ended 15 August 2009.

The LEI, a gauge of current economic activity in the US, rose 0.6 per cent to 101.6 (2004=100) in July, the Conference Board said yesterday. The LEI climbed 0.8 per cent in June and 1.2 per cent in May.

The New York-based group said that the rise in its LEI for the US is a sign that the recession has bottomed out, and growth in economic activity will begin soon.

Says Ken Goldstein, economist at The Conference Board: "The indicators suggest that the recession is bottoming out, and that economic activity will likely begin recovering soon. The Leading Economic Index, which has increased for four consecutive months, suggests that the CEI will turn positive soon."

The six-month growth rate rose to 3 per cent through July, up from 2.1 per cent through June. That's the highest growth rate since mid-2004, the Conference Board said.