U.S. Leading Economic Index Rose 1.2 Percent in May

U.S. Leading Economic Index Rose 1.2 Percent in May

June 18 (Bloomberg) -- The index of U.S. leading economic indicators rose more than forecast in May for the second straight month, reinforcing signs that the worst recession in five decades may end this year.

The Conference Board’s gauge increased 1.2 percent after a revised 1.1 percent in April, the biggest back-to-back gain since November-December 2001, according to data the New York- based group released today. The index points to the direction of the economy over the next three to six months.

The gains in stock prices, consumer confidence and building permits that are propelling the leading index higher bolster forecasts the economy will start growing again in the second half of 2009. Still, mounting unemployment and tight credit mean the recovery will be slow.

“The recession is losing steam,” Ken Goldstein, an economist at the Conference Board, said in a statement. “If these trends continue, expect a slow recovery beginning before the end of the year. However, employment will take longer to turn around.”