Driven primarily by steep drops in stock prices and weakness in initial jobless claims, the Conference Board released a report on Thursday showing a modest decrease by its index of leading U.S. economic indicators in the month of January.
The Conference Board said its leading economic index edged down by 0.2 percent in January following a revised 0.3 percent decrease in December. The modest drop by the index matched economist estimates.
"Despite back-to-back monthly declines, the index doesn't signal a significant increase in the risk of recession," said Ataman Ozyildirim, Director of Business Cycles and Growth Research at the Conference Board.
Ozyildirim noted the leading index's six-month growth rate remains consistent with a modest economic expansion through early 2016.
The modest decrease by the index reflected negative contributions from stock prices, average weekly initial jobless claims, the ISM new orders index, and building permits.
Meanwhile, positive contributions from the interest rate spread, manufacturers' new orders for non-defense capital goods excluding aircraft, average weekly manufacturing hours, the Leading Credit Index, and average consumer expectations for business conditions limited the downside.
The Conference Board also said its coincident economic index rose by 0.3 percent in January after inching up by 0.1 percent in December.
All four indicators that make up the coincident index increased during the month, with industrial production providing the largest positive contribution.
The report said the lagging economic index also ticked up by 0.1 percent in January after rising by 0.2 percent in the previous month.
The increase reflected positive contributions from five of the seven components, including commercial and industrial loans outstanding, the average prime rate charged by banks, and the change in consumer prices for services.
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