NEW YORK (12/30/13)--An indicator of future economic growth increased last week while another measure of annualized growth lost pace, according to a New York-based research firm.
The Economic Cycle Research Institute said on Friday that its Weekly Leading Index rose the week ending Dec. 20--to 131.93 from 130.91--while its annualized growth rate dropped to 1.86% from 2.14%. (Reuters and Economy.com Dec. 27).
Moody's analysts said that the ECRI annualized growth rate fell to its lowest level in eight weeks, well below the third quarter average of 4.3%, and just above the 2013 low of 1.7%. The measure hasn't breached a 3% ceiling this quarter after averaging 6.7% in the first six months of 2013.
The analysts also said that the modest rise in the weekly index is consistent with recent positive measures of industrial growth. Before it grew during the week that ended Dec. 20, WLI growth had dropped for two weeks in a row, from 132.5 for the week ending Nov. 29.
The WLI is just above its 52-week moving average of 130.65, while the annualized growth rate is below its 52-week moving average of 5.07%.
Moody's analysts said they expect the annualized growth rate to expand in the coming weeks, with house and equity prices on the up, and economic growth and payrolls both expanding. Negative outlooks are muted, the observers say, because of the recent congressional budget agreement and the "relatively smooth" tapering of the Federal Reserve's quantitative easing program--set to begin in January. The research firm said annualized GDP growth will hit 4% in the second half of 2014.