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WLI Growth Surges to Five-Year High

A forward-looking measure of U.S. economic growth fell in the latest week but its yearly growth rate surged to levels last seen in 2004, easing concerns that a second economic stimulus may be needed from Washington, a research group said on Friday.

The Economic Cycle Research Institute, a New York-based independent forecasting group, said its projection that the recession will end this summer is not based on results from the Obama administration's current $787 billion stimulus package.

"The bulk of that government spending is still in front of us," said Lakshman Achuthan, managing director at ECRI, adding that calls for a second stimulus are unnecessary.

The current stimulus "may reinforce the recovery many quarters from now, but it's not the reason you're having a recovery," said Achuthan, reiterating comments made earlier Friday on CNN.

The research group's Weekly Leading Index slipped to 118.1 in the week to July 10 from a revised 119.0 the prior week, which ECRI originally reported at 118.5.

But the index's annualized growth rate surged to a five-year high of 7.0 percent from 6.2 percent one week ago, which was revised higher from 5.4 percent.

It was the gauge's highest yearly growth rate reading since the week ended May 14, 2004, when it was 7.1 percent.

Achuthan said he expects a smooth economic recovery, and that policy debates should not be linked to recovery forecasts.

"The recession is already ending," Achuthan said. "With WLI growth surging to a five-year high, the recession's days are numbered, and the coming recovery is looking more resilient."...