U.S. Leading Indictors Fall Again; Continued Slowing Predicted

In another gloomy report about the economic outlook, the Conference Board said Thursday that its index of U.S. leading economic indicators dropped 0.3% in February.

February’s slide was a bit greater than analysts’ forecast of a 0.2% drop, following a slight 0.5% increase in January, Bloomberg noted.

The New York-based private research group said its index, which tries to predict economic activity over the next three to six months, fell in February for the eighth time in the last 10 months.

Analysts say that when the index drops for a number of consecutive months, a recession is likely to follow.

However, the board said the index has not declined enough yet to signal a recession. But Conference Board economist Ken Goldstein did warn this current period of slower economic growth will likely continue for at least the next few months.

Last month’s decline came partly because manufacturers were trimming work hours to cut costs, Bloomberg noted. Slower manufacturing output hurts trucking companies since it curbs the potential volume of freight shipped on trucks.

Other indicators weighing down the index included depressed consumer confidence and increases in the weekly level of claims for unemployment insurance benefits, the report noted.

Meanwhile, investors continued selling stocks Thursday as the report only deepened their conviction that an economic recovery is unlikely any time soon, the Associated Press reported.

The Dow Jones Industrial Average fell more than 380 points by afternoon, before rallying to close down a more moderate 96.41 at 9,390.59.

It has dropped by triple digits in six of the past nine trading sessions, falling more than 20% from the closing high of 11,722.98 it reached on Jan. 14, 2000.

The declines have continued this week in disappointed reaction to the Federal Reserve’s Tuesday decision to cut interest rates by only half a point, when the markets looked for a three-quarters-point cut. Transport Topics