NEW YORK — Gas prices are high, food is more expensive and the job market is cold, but the U.S. may still avoid a recession.
That was the message Monday from a private business group whose index of leading economic indicators defied expectations and inched higher in April.
The New York-based Conference Board said its forecast of future economic activity rose 0.1 percent in April, matching a 0.1 percent increase in March. Economists had expected a 0.1 percent drop in April. The index is designed to forecast activity in the next three to six months, based on 10 economic components, including stock prices, building permits and initial claims for unemployment benefits.
“These data certainly reflect a weak economy, but not one in recession,” said Ken Goldstein, labor economist at the Conference Board. The small increases in March and April, which followed five months of decline, could be a signal the economy may not weaken further, he said.
Six of 10 leading indicators that the Conference Board measures rose in April, including stock prices, interest-rate spreads and housing permits. Those increases more than offset the sharp declines in average weekly hours worked and consumer spending.
The six-month rate of decline for April, which economists look to as a predictor of recessions, was negative 1.2 percent, which points to sluggish growth at best, said economist Dana Saporta of German investment bank Dresdner Kleinwort.
The Bush administration reiterated Monday that it was too soon to consider a second stimulus package. After getting an update from Treasury Secretary Henry Paulson, President Bush said Paulson had assured him people are getting the money.
“It should help our economy and, more importantly, help people pay their bills … and take care of their families and shop,” the president said.
More than half the members of the National Association for Business Economics say the economy has started or will enter a recession this year, according to a survey released Monday. Now, 56 percent of the economists think the economy has started or will enter a recession this year, up from 45 percent in a survey in February.
They forecast 1.4 percent growth for the year, which would be the weakest growth since the 2001 recession.
