WLI Growth Rises Further

Reuters
July 02, 2009

(Reuters) - A gauge of future U.S. economic growth stood unchanged in the latest week but its yearly growth rate climbed to an almost two-year high, reaffirming hopes that the grips of deep recession are loosening, a research group said on Friday.

The Economic Cycle Research Institute, a New York-based independent forecasting group, said its Weekly Leading Index was unchanged from its prior reading of 117.6 for the week ended June 26.

But the index's annualized growth rate, which finally entered positive territory last week, spiked to just under a two-year high of 4.0 percent from its previous rate of 2.1 percent.

It was the growth rate gauge's highest yearly reading since the week ended Aug. 3, 2007, when it stood at 4.3 percent, bringing a solid end to its 22-month stretch in the red.

"With WLI growth rising further into positive territory, it is clearly looking ahead to positive U.S. economic growth in the near term," said Lakshman Achuthan, managing director at ECRI, who has lately projected that the recession will end sometime this summer.

The weekly index rose in the latest week due to lower interest rates, but was partly offset by weaker housing activity, Achuthan said.