Indicators Offer Evidence of Slowing Economy

The index of leading U.S. economic indicators fell in May, the second straight month without an increase and the latest evidence that interest-rate increases from the Federal Reserve in the last year are slowing growth. The Conference Board’s index--considered a gauge of economic performance over the next six to nine months--fell 0.1% in May after being unchanged in April. Analysts had expected a decline of 0.2% for May. The April index was initially reported as declining 0.1%. The decline in the May index, compiled by the New York-based research group using previously reported economic statistics, was led by reduced factory hours, rising claims for unemployment benefits and falling stock prices. In addition, a decline in building permits, a drop in factory orders for non-defense capital goods, faster supplier deliveries and a shrinking money supply contributed to the negative reading. Indicators making a positive contribution to the index were rising factory orders for consumer goods, a wider spread between the yield on the 10-year Treasury note and overnight bank rate, and increased consumer optimism.