Economic gauge rises 0.4 percent in December

Published November 20, 2014

A gauge of future economic activity rose in December, providing evidence the economy was gaining strength as the year ended.

The Conference Board said Thursday that its index of leading economic indicators rose 0.4 percent last month following a revised 0.2 percent increase in November and a revised 0.6 percent gain in October.

The December report reflects extensive changes in how the index is put together which the Conference Board hopes will make the index a better forecaster of where the economy is headed.

Conference Board economist Ken Goldstein said the December reading provided support for cautious optimism about how the economy will perform in the first half of 2012. But he pointed out that a strengthening U.S. economy will have to overcome problems stemming from Europe's debt crisis and slowing growth in Asia.

"Looking ahead, the big question remains whether cooling conditions elsewhere will limit domestic growth or, conversely, growth in the U.S. will lend some economic support to the rest of the globe," Goldstein said.

The largest contributors to the leading index in December were the spread on interest rates between short-term rates and longer term rates and improving employment indicators. Seven of the 10 indicators that make up the leading index made positive contributions in December.

Three of the components of the index had negative readings in December with the largest drag coming from consumer expectations.

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