Leading indicators in U.S. grow at slower pace as economy cools

WASHINGTON – The index of U.S. leading indicators rose at a slower pace in January, restrained by declines in building permits and factory orders that signal a slower pace of growth.

The Conference Board’s index, a measure of the outlook for the next three to six months, climbed 0.2 percent last month, after a revised 0.4 percent gain in December that was smaller than initially reported, the New York-based group said Thursday. The median forecast of 49 economists surveyed by Bloomberg called for a 0.3 percent advance.

A rising dollar and sluggish growth overseas that are holding back U.S. manufacturing and an uneven housing recovery are restraining the world’s largest economy at the start of 2015. That’s bearing out Federal Reserve policy makers’ concerns and explains why many officials last month said they were willing to leave interest rates low for longer.

“The lack of strong momentum in residential construction, along with a weak outlook for new orders in manufacturing, poses a downside risk for the U.S. economy,” Ataman Ozyildirim, an economist at the Conference Board said in a statement. Nonetheless, the index “suggests a positive short-term outlook in 2015.”

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Estimates in the Bloomberg economist survey ranged from gains of 0.1 percent to 0.6 percent. The December reading was initially reported as a 0.5 percent increase.

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