U.S. economy seen slowing in next 3-6 months

first_imgThe job market showed surprising strength Thursday, with the Labor Department reporting a drop in jobless claims. The number of U.S. workers filing new claims for jobless benefits fell for a fifth straight week, to the lowest level in four months. “The job market is holding together better than any other part of the economy. Otherwise, we might be sliding into a recession,” Zandi said. A better-than-expected picture of the industrial sector also bolstered investors’ confidence this week, but mixed housing figures offered a more measured dose of optimism.160Want local news?Sign up for the Localist and stay informed Something went wrong. Please try again.subscribeCongratulations! You’re all set! The reading tracks 10 economic indicators. Two of those were positive in April: stock prices and real money supply. The negative contributors, beginning with the largest, were building permits, weekly unemployment claims, manufacturers’ new orders for nondefense capital goods, consumer expectations, vendor performance, average weekly manufacturing hours and interest rate spread. With the latest decline, the cumulative change in the index over the past six months has dropped 0.2 percent. The slowdown should ease concerns that the Federal Reserve will raise interest rates, said Mark Zandi, chief economist at Moody’s Economy.com. The interest-rate standstill over the past nine months has driven the Dow Jones industrial average to record highs. The Conference Board’s report came amid a batch of mixed economic data, reflecting the ongoing uncertainty over the direction of the economy. NEW YORK – A gauge of future economic activity showed the U.S. economy will slow in coming months, reversing recent gains and suggesting that higher gas prices and a sluggish construction industry are beginning to take their toll. The Conference Board said Thursday that its index of leading economic indicators dropped 0.5 percent, higher than the 0.1 decline analysts were expecting. The reading is designed to forecast economic activity over the next three months to six months. The increase almost reversed an amended 0.6 percent climb in March, which analysts say should relieve pressure on the Federal Reserve to raise interest rates. “The data may be pointing to slower economic conditions this summer. With the industrial core of the economy already slow, and housing mired in a continued slump, there are some signs that these weaknesses may be beginning to soften both consumer spending and hiring this summer,” said Ken Goldstein, labor economist for the Conference Board. last_img

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