(Source: Tulsa World)
By TALI ARBEL
NEW YORK - A private research group said U.S. economic growth
should strengthen by summer, but cautioned that consumer concerns
over rising gas and food prices could drag on the expansion.
The Conference Board said Thursday that its index of leading
economic indicators rose 0.4 percent in March. The index, which is a
measure of future economic activity, has increased for nine straight
months.
Growing demand for U.S. manufactured goods and a rebound in
requests for building permits helped drive last month's gains. Six
of the index's 10 components rose. The index rose 1.0 percent in
February, revised higher from the initial estimate of 0.8 percent.
The leading indicators began moving sharply higher last fall,
coinciding with a decline in the unemployment rate and a stock
market rally.
Still, the trade group said one of the components of its index -
a consumer confidence survey - tumbled to a two-year low last
month. The primary reason for the decline is that many people are
increasingly worried about inflation.
Consumers are spending more, but the rise in costs for basic
necessities could force them to spend less on discretionary goods.
That could slow economic growth. Consumer spending accounts for 70
percent of economic activity.
Gasoline jumped 5.6 percent last month and has risen nearly 28
percent in the past year, the government reported last week.
Consumers paid an average price of $3.84 a gallon nationwide on
Thursday, according to the travel group AAA. That's up $0.30 from
March and nearly $1 from a year ago
The government also said that retail food prices rose 0.8 percent
in March, the largest increase in almost three years. Consumers paid
more for fruits and vegetables, dairy products, chicken and beef.
The Conference Board, a private research group based in New York,
compiles data that has mostly already been released about real
estate, manufacturing, employment, consumer confidence and financial
markets. It uses that data to calculate the leading indicator index.
The Conference Board also includes its own estimates about
manufacturers' new orders and the country's money supply. SUBHEAD:
However, fuel and food costs may counteract growth.
Originally published by TALI ARBEL Associated Press.
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