Housing rips hole in economic outlook
The economic outlook darkened in April as weakness in home construction and rising unemployment claims took hold, The Conference Board reported today.
The U.S. leading index, a key barometer of future economic conditions, dropped 0.5 percent last month to 137.3, with just two of the 10 leading indicators advancing. Based on revised data, the index rose 0.6 percent in March and sank 0.6 percent in February.
Declines in housing permits made the largest negative contribution to the leading index in April, which is now 0.7 percent below its year-ago level, and "weaknesses among the leading indicators have been somewhat more widespread than the strengths over the past few months," The Conference Board reported in a statement.
In the first quarter, real GDP -- which measures the total value of goods and services produced by the United States for a given period -- grew at only a 1.3 percent annual rate (advance estimates), following a 2.5 percent rate in the fourth quarter of 2006. In addition, The Conference Board said "the recent behavior of the composite indexes suggests that economic growth is likely to continue to be slow in the near term."
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