Economic Indicators Decline in February
War fears, souring consumer sentiment and volatile energy prices sent a key U.S. economic forecasting gauge down for the first time in five months in February, while the job market showed few signs of revival, reports showed Thursday.
Hours after the opening salvos in the U.S.-led war on Iraq, the New York-based Conference Board said tension preceding the conflict helped push its index of leading indicators down 0.4% last month, the first dip in five months.
Sliding stock markets last month weighed on the index. In recent days, Wall Street has staged a comeback on hopes of a short war.
A separate report from the Labor Department showed that the number of people filing for first-time unemployment benefits fell last week for the second straight week.
“The small weekly decline in the weekly initial claims ... suggests that the labor market continues to struggle toward a path of improvement,” said Anthony Chan, chief economist at Banc One Investment Advisors Corp.
First-time claims dropped to 421,000 last week from a revised 425,000 in the previous week. But the four-week moving average crept up to 424,750 from 421,000, which Chan said “strongly implies much more difficulty still lies ahead.”
“We are still quite a distant way from even the gray market area of 350,000 to 400,000 reading on claims that implies a real gradual to fast labor market recovery,” he added.
The moving average, regarded as a better and less volatile gauge of job market conditions, rose for the seventh week in a row to its highest level in 10 months.
The 0.4% decline in the Conference Board’s leading economic indicators gauge was the largest since a 0.5% decrease in September.
The index was up a revised 0.2% in January.
Falling stock prices, declining consumer confidence and rising initial claims for unemployment benefits were three of the six indicators that pushed the index lower. The group bases its measurement on seven previously reported economic statistics and estimates for three others.
