A closely watched gauge of future U.S. economic activity rose in February by the largest amount in three months, a private-sector research organization reported Thursday, suggesting growth should strengthen after a weather-induced slowdown in the first quarter. The Conference board said its index of leading economic indicators—designed to predict activity in the coming three to six months—increased 0.5 percent last month following a 0.1 percent advance in January and a 0.1 percent decline in December. It was the best performance since a 0.9 percent gain in November. Five of the 10 indicators in the index contributed to the February increase, led by a jump in building permits and the spread between short- and long-term interest rates. The gain was limited by weaker consumer confidence. The better-than-expected increase indicates "that any weather-related volatility will be short-lived and the economy should continue to improve into the second half of the year," Conference Board economist Ataman Ozyildirim said in a statement. The report's sub-index of coincident indicators—a gauge of current economic activity that tracks payrolls, incomes, sales, and production—rose 0.2 percent after a 0.1 percent gain in January. The gauge of lagging indicators—a measure of previous activity that tracks unemployment duration and service-price inflation—rose 0.3 percent in February.
