U.S. Economy Still Growing, Indicators Show : Forecast: March index, at record high, points to modest gains. Recovery is evident in all regions, including the Pacific.

The nation’s key indicator of future economic expansion reached a record high in March, a sign of continued modest growth after a lull due to bad weather in February, the Commerce Department reported Tuesday.

The widely watched index of leading economic indicators rose 0.7%, showing a seventh month of growth out of the last eight, the Commerce Department said. The index reached 101.2, its highest level since record-keeping began in 1948.

Separately, the private Conference Board reported Tuesday that for the first time since 1988, all parts of the United States were growing economically, including the Pacific region, which was hit particularly hard by the recession.

“The economic state of the union is quite satisfactory at the present, with the expansion firmly in place across a broad front,” said Robert Dederick, chief economist with Northern Trust Co. in Chicago.

Economists and Clinton Administration officials downplayed fears that continuing economic growth would lead to inflation--a concern that has prompted the Federal Reserve Board to bump up short-term interest rates by three-quarters of a percentage point since the beginning of the year.

At a meeting of the U.S. Chamber of Commerce in Washington on Tuesday, Laura D’Andrea Tyson, chairwoman of the President’s Council of Economic Advisers, said the indicators confirm the Administration’s expectation that the economy will expand at a modest 3% rate this year and that the inflation rate will also be about 3%.

Nine of the index’s 11 components showed improvement in March, the Commerce Department said. The index is designed to foreshadow economic activity six to nine months ahead. It was flat in February.

The rise in March was due mainly to a longer average workweek compared to the month before, when severe winter weather kept many people at home.

The average workweek increased to 42.2 hours, the longest since World War II, said Barry Beckman, chief of the business cycle indicators branch of the department’s Bureau of Economic Analysis.

“Most of the strength in the indicators . . . is tied to (non-defense) manufacturing activity,” said Joseph Carson, chief economist with Dean Witter Reynolds in New York. “It’s what we call trading places (with foreign competitors): U.S. manufacturing is a low-cost producer on a global basis today.”

The only indicators that fell were stock prices, which have been spooked by rising interest rates, and the time it took companies to deliver goods. Delivery waits were shorter, which indicates fewer orders, the Commerce Department reported.

Meanwhile, the New York-based Conference Board, a private business research group, said its regional performance index, which measures local economic activity, rose to 122.5 in February from 121.6 the month before, with all regions of the country showing year-over-year growth.

“Economic growth late last year got to the point where it really carried all regions into the plus column,” said Jason Bram, an economist with the Conference Board.

The Midwest economy, stoked by resurgent manufacturing, and the Mountain and South Atlantic regions grew the fastest. They were trailed by the Northeast, New England and Pacific regions.

Other reports echoed that upbeat outlook Tuesday:

* Purchasing executives at industrial companies estimate that revenues will rise 7% in 1994, according to a survey conducted by the National Organization of Purchasing Management.

* About 80% of corporate financial executives expect their companies to take in more revenue in the next six months, and many are predicting higher profits, according to a survey released Tuesday by the Financial Executives Institute.

Index of Leading Indicators

Seasonally adjusted; 1987 = 100, March 1994: 101.2 Source: Commerce Department