Leading Indicators Suggest Better Times May Be Ahead

By John S. McClenahen With lowered expectations for profits and capital spending, CEOs were even less confident about the economic future than they had been three months ago, The Conference Board reported last week. However, the New York-based business research group's Index of Leading Economic Indicators released this week suggests better times may lie ahead for those CEOs. According to the latest figures, the index increased 0.3% in October, as seven of its 10 indicators advanced. Vendor performance, interest-rate spread, money supply, stock prices, manufacturers' new orders for goods and materials, manufacturers' new orders for nondefense capital goods, and the index of consumer expectations were all higher. In contrast, the three remaining indicators -- average weekly initial claims for unemployment insurance, average weekly manufacturing hours, and building permits -- all declined. With October's advance, the Index of Leading Indicators now stands at 109.4 (1996=100), following a 0.5% decline in September and a 0.1% decline in August.

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