US leading indicators post third rise in a row

Seth Perlman/AP
A construction worker begins a new home in Springfield, Ill. The rise in construction permits for new homes was one of the key leading indicators pointing to a coming upturn in the US economy, the Conference Board reported Monday.

Leading indicators for the US economy jumped for the third month in a row in June, providing fresh evidence that the year-and-a-half long recession is nearing its end.

“We really are picking up this sense that the recession is running out of energy," said Ken Goldstein, economist at The Conference Board, which released the new data Monday. The positive signals are broadly dispersed and have proved durable, he added in an interview.

The monthly index rose 0.7 percent from May to June, following monthly increases of 1.0 percent in April and 1.3 percent in May, according to The Conference Board in a report released Monday. That was enough to show a 2 percent gain over the past six months (even counting the declines in the first three months of the year). That's the strongest six-month bounce in the index since 2006.

Similar to last month, seven of the index’s 10 components were positive, led by improvements in the interest rate spread, building permits, and stock prices. The index is designed to forecast economic conditions a few months ahead.

"The critical question is what’s next?" wrote MFR economist Joshua Shapiro in an analysis. "Our feeling is that data will start to flatten out, indicating an elongated trough for the economy."

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