• Tue. Mar 21st, 2023

U.S. economy headed for difficulty, major index signals


Mar 17, 2023

By Jeffry Bartash

Major financial index falls .three% in February

The numbers: The U.S. major financial index fell .three% in February — the 11th decline in a row — and continued to signal an upcoming recession.

Economists polled by The Wall Street Journal had forecast a .four% drop.

The LEI is a gauge of ten indicators developed to show no matter if the economy is acquiring much better or worse. The report is published by the nonprofit Conference Board

Large image: The economy has slowed due to the finish of pandemic stimulus and the effects of higher inflation, which has forced the Federal Reserve to raise interest prices.

Greater borrowing expenses commonly tame inflation, but at the expense of a weaker financial development.

Though the major index has been signaling a recession for months, the economy is nevertheless expanding. A huge query is no matter if the most current banking crisis ends up becoming a tipping point. So far regulators seem to have contained the harm.

Essential facts: Eight of the ten indicators tracked by the Conference Board fell in February.

A measure of present financial situations, meanwhile, rose a scant .1% in February.

The so-known as lagging index — a appear in the rearview mirror — also improved by .1%.

Seeking ahead: “The major financial index nevertheless points to danger of recession in the US economy,” stated Justyna Zabinska-La Monica, senior manager of small business cycle indicators at the board. ” The most current economic turmoil in the U.S. banking sector is not reflected in the LEI information but could have a damaging effect on the outlook if it persists.”

Market place reaction: The Dow Jones Industrial Typical and S&ampP 500 fell in Friday trades amid nagging worries about the U.S. economic technique immediately after the failure of Silicon Valley Bank.

-Jeffry Bartash

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03-17-23 1013ET

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