WASHINGTON – The Conference Board said its index of leading economic indicators rose 0.6 percent in January, its fourth consecutive monthly gain, suggesting that the recovery of the U.S. economy from recession could be much stronger than expected.
The index measures where the overall U.S. economy is headed in the next three to six months. It stood at 100 in 1996, its base year.
The Conference Board, a business-funded research group, said three increases in the index generally signal that the economy will expand in the next three to six months. The economy has been contracting since last March.
The January rise exceeded expectations of Wall Street economists who had forecast the index to grow by 0.5 percent. It also comes after a strong 1.3 percent rise in December, the largest gain in almost six years.
"The strong signal from the indicators is that the recession is ending and that the recovery could be more vigorous than earlier anticipated," Ken Goldstein, the board's chief economist, said in a statement.
"Given this string of strong increases, the cumulative rise in the index over the past six months is very positive and suggests gathering economic momentum," he added.
The lagging index, which measures past trends in the economy, was unchanged last month after a 0.1 percent increase in December.
Six of the 10 components that make up the leading indicators index rose in January, led by slower deliveries, consumer expectations and jobless claims.
The remaining four components, the average workweek, stock prices, capital goods orders and manufacturers' new orders, fell in January.
Reuters and the Associated Press contributed to this report.