Lower unemployment and brisk manufacturers' orders for goods and plant equipment pushed the government's Index of Leading Economic Indicators up 0.4 percent in August, the Commerce Department said Friday.
Despite a 0.9 percent increase in economic performance from August 1987 to August 1988, it is still the slowest since the recession year of 1982, when the index dropped 4.4 percent from August 1981 to August 1982, the bureau said.The modest August increase was in line with analysts' expectations and should relieve some who worried that a 0.6 percent July decrease signaled the beginning of an economic downturn.
"This might help to dispel some of the recent speculation that the economy was losing its upward momentum," said Robert Dederick, chief economist for the Northern Trust Co. in Chicago.
The department's Bureau of Economic Analysis said five of the nine indicators available for August contributed to overall economic performance in August, a forecast of how the economy may be doing three to six months down the road.
These included lower new claims for unemployment, increased manufacturers' orders for both consumer goods and plant equipment, higher applications for building permits and higher prices for raw materials.