Economic Report: More evidence the U.S. economy is growing strongly is shown in June’s leading index

Economic Report: More evidence the U.S. economy is growing strongly is shown in June’s leading index

The U.S. economy keeps on truckin’. A barometer known as the leading index rose sharply in June.

The numbers: The U.S. economy sped up in June, according to an index that attempts to forecast the nation’s economic health.

The leading economic index rose 0.5% after no gain in May, the Conference Board said Thursday.

A measure of current conditions — or how the economy is doing right now — climbed 0.3%.

A “ lagging” index that looks back at the past several months advanced 0.3%.

What happened: Most of the segments of the economy covered by the leading index showed greater strength in June with the lone exception of housing. Higher interest rates, a shortage of construction workers and rising costs of supplies such as lumber might be starting to curb work on new homes.

The LEI is a weighted gauge of 10 indicators designed to signal business-cycle peaks and valleys.

Big picture: The economy could grow as high as 4% or more in the recently concluded second quarter that ran from April to June. The most immediate problem for what is now a very robust economy is a growing shortage of skilled workers while the threat of a tariff war casts a cloud over the future.

But for now, times are good.

What they are saying?: “The widespread growth in leading indicators, with the exception of housing permits which declined once again, does not suggest any considerable growth slowdown in the short-term,” said Ataman Ozyildirim, economist at the board.

Market reaction: The Dow Jones Industrial Average DJIA, -0.45% and the S&P 500 SPX, -0.46% fell in Thursday trades, and if they close lower, it will break a five-day winning streak. The 10-year Treasury yield TMUBMUSD10Y, -0.61%   rose slightly to 2.86%.

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