Caution Reigns As Leading Indicators Rise Again

By John S. McClenahen The Conference Board's Index of Leading Economic Indicators rose in June, making it the third consecutive monthly increase. However, the New York-based business research group is being very cautious about what this means, saying it "suggests the flat trend in the leading index over the past year may have ended, but additional months of growth are needed to determine if an upward trend has indeed developed." The leading index now stands at 111.8 (1996=100). The index rose 0.1% in June, following increases of 1.1% May in May and 0.1% in April. Four of the 10 elements that make up the leading index were positive in June: money supply, stock prices, initial unemployment insurance claims and building permits. Consumer expectations, vendor performance, interest rates and new factor orders for consumer goods were the four negatives. And average weekly manufacturing hours and new factory orders for nondefense capital goods were unchanged from May.

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