The Conference Board Leading Economic Index (LEI) for the U.S. rose 0.3% in October, the seventh consecutive month of gains.
The LEI rose 1% in September and 0.4% in August. Eight of the ten LEI components advanced in October.
"The data indicates that economic recovery is finally setting in," said Ken Goldstein, economist at The Conference Board. "We can expect slow growth through the first half of 2010. The pace of growth, however, will depend critically on how much demand picks up, and how soon."
Added Ataman Ozyildirim, also an economist at The Conference Board: "After half a year of consecutive increases, the month-to-month growth of the LEI is stabilizing and the gains continue to be broad-based. Meanwhile, the coincident economic index has been essentially flat since June, after declining since November 2007. The composite indexes suggest the recovery is unfolding and economic activity should continue improving in the near term."
The continuing improvement in the LEI was in contrast to Wednesday’s Census Bureau report on October housing starts, which unexpected fell more than 10% in October.
Analysts attributed the drop to caution among homebuilders at the impending expiration of the first-time homebuyer tax credit at the end of November. The tax credit was extended and expanded earlier in the week, however, suggesting that home sales may pick up in the coming months.