The U.S. economic recovery is gaining momentum, according to a couple of macroeconomic reports published on Thursday.
The Conference Board Leading Economic Index (LEI), which forecasts future economic activity, increased 1.3% in March to 111.6 (2016 = 100), following a 0.1% decrease in February and a 0.5% increase in January.
"The U.S. LEI rose sharply in March, which more than offset February's slightly negative revised figure," Ataman Ozyildirim, senior director of economic research at The Conference Board, said. "The improvement in the U.S. LEI, with all ten components contributing positively, suggests economic momentum is increasing in the near term. The widespread gains among the leading indicators are supported by an accelerating vaccination campaign, gradual lifting of mobility restrictions, as well as current and expected fiscal stimulus. The recent trend in the U.S. LEI is consistent with the economy picking up in the coming months, and The Conference Board now projects year-over-year growth could reach 6.0 percent in 2021."
Separately, the Labor Department reported that the number of Americans filing for unemployment claims dropped to 547,000 in the week ending April 17. It is the lowest level since March 2020, when non-essential businesses were under lockdown.
These reports come one week after the U.S. government reported that March retail sales rose 9.8% from February and 27.7% from a year earlier, the most significant increase since May 2020.
Still, the news of the economy gaining steam failed to light up Wall Street, which was trading lower at mid-day. The S&P 500 was trading at 4,152.10, down 0.52% for the day, while the Dow Jones was trading at 33,913.17, down 0.66%. The Nasdaq composite was trading at 13,879.12, down 0.50% for the day as tech stocks lost their momentum.
Meanwhile, U.S. Treasury bonds were trading near flat, with the 10-year bond trading at 1.58%, up 0.95% for the day, meaning that traders and investors are little concerned about the more robust economy fueling inflation.
Apparently, traders and investors have been paying more attention these days to geopolitical events that raise demand for safe-haven assets like Treasuries and less on the U.S. economic recovery.
Disclosure: No positions.
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