US leading indicators: signs of thaw?

They say April is the cruellest month. But late February – in the middle of the worst financial crisis in 70 years – is a pretty good stand-in.

That's why it's hard to get excited about the surprising 0.4 percent rise in the Conference Board's index of leading indicators.

The index is designed to reveal the future direction of the economy. So, if January was up a weak 0.4 percent and December an even weaker 0.2 percent, do we have the initial signs of a rebound?

Down less intensely

The intensity of the recession "may begin to ease over the next few months," says the Conference Board's economist, Ken Goldstein, although he sees more contraction until anemic growth takes hold in the second half of the year.

The index rose with only halfway vigor. Five of its 10 indicators were up, led by the growth in the real money supply, and five were down, led by average weekly initial claims for unemployment insurance.

Other signs still look wintry.

Bleak employment

The latest unemployment claims data, also released Thursday, were as bleak as last week's – 627,000. The four-week average rose so that it now stands at its highest level since 1982.

Thursday also saw the Federal Reserve Bank of Philadelphia’s general economic index drop to minus 41.3, far worse than expected, and the fastest contraction of manufacturing in the region since the early 1980s.

That's the problem with late winter. The tendrils of optimism get crushed by ice again and again, until spring finally melts the snow.