WASHINGTON (AFX) - The US leading index fell 0.4 pct in July, the Conference Board said. This is the largest drop since Sept 2001. The fall in the index in July was in line with forecasts of Wall Street economists. In June, the index fell a revised 0.2 pct, down from the initial estimate that the index was unchanged.
"The second consecutive decline in the leading economic indicators raises fears about the current recovery," said Ken Goldstein, Conference Board economist. But he noted that there is yet to be a significant decline in consumer markets as home and car sales remain robust.
The coincident index rose 0.1 pct in July, after a 0.3 pct rise in the previous month. This is the fifth gain in the last six months. The lagging index rose 0.1 pct after a 0.3 pct fall in the previous month. Six of the ten indicators that make up the leading index decreased in July.
The negative contributors to the index, from the largest to the smallest, were stock prices, average weekly manufacturing hours, index of consumer expectations, interest rate spread, vendor performance and building permits. The four positive contributors were real money supply, manufacturers new orders for non-defense capital goods, initial weekly jobless claims, and manufacturers new orders for consumer goods.