WASHINGTON - A gauge designed to predict the economy's future health posted a solid gain in April, further evidence of stronger growth after a severe winter dampened activity.
The Conference Board said Thursday that its index of leading indicators increased 0.4 per cent in April following an upwardly revised 1 per cent gain in March. The strength in April was led by improving housing and financial market conditions.
"Despite a brutal winter which brought the economy to a halt, the overall trend in the leading economic index has remained positive," said Conference Board economist Ken Goldstein. He said stronger spending by consumers and higher business investment should bolster growth in coming months.
The overall economy grew at a barely discernible 0.1 per cent rate in the January-March quarter but many analysts expect growth will bounce back to an annual rate over 3.5 per cent in the current April-June quarter and will remain above 3 per cent in the second half of this year.
For April, five of the 10 forward-pointing indicators made positive contributions. The largest contribution came from the spread in interest rates followed by a big jump in building permits.
The biggest negative factor holding the index back was a drop in average weekly manufacturing hours.