leading index signals economic growth in short term

LEADING INDEX SIGNALS ECONOMIC GROWTH IN THE NEAR TERM

The U.S. leading index, a key barometer of economic conditions, declined 0.2 percent to 139.0 (1996=100) in February after increasing the previous four months, The Conference Board recently reported.

Five of the 10 indicators composing the leading index increased last month, including manufacturers' orders for nondefense capital goods, real money supply, average weekly manufacturing hours, manufacturers' orders for consumer goods, and interest rate spread.

Despite the decline, the leading index suggests economic growth is "likely to pick up in the near term," according to the report.

The coincident and lagging indices, which reflect current and past economic activity, respectively, increased in February.

The coincident index edged up 0.3 percent to 122.1, while the lagging index rose 0.1 percent to 122.6.

**taken from the California Association of Realtors Bulletin, dated March 23, 3006.