Leading Indicators Fell Last Month; Decline is Fourth in a Row; Hurricanes, High Oil Prices Slowed Growth of Economy
WASHINGTON -- The Conference Board's composite index of leading indicators slipped in September for the fourth straight month, signaling that the economic soft patch will persist.</br></br>Separately, the U.S. Labor Department reported that the number of workers filing first-time applications for unemployment benefits dropped by an unexpectedly steep 25,000 last week, a decline that may have been skewed by the holiday-shortened week.</br></br>The Conference Board, a private research group in New York, reported that its composite index of leading indicators fell by 0.1% to a reading of 115.6 in September, after August's 0.3% decline. The slightness of the declines in the past four months seems to argue against invoking the economists' rule of thumb that three consecutive declines in the index signal a recession.</br></br>"While the leading index is not yet signaling a downturn, the growth rate of the leading index has slowed," said Ken Goldstein, an economist with the Conference Board. Economic growth should continue, but more slowly than expected, he added. The index is designed to predict the economy's path during the next three to six months.</br></br>Oil prices have had a negative impact on the economy, but not enough to produce a broad spike in inflation. Recent hurricanes may also have held down economic activity, the Conference Board said.