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Leading indicators up 0.3%
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June 30, 1999: 11:01 a.m. ET
May index, released as Fed meets, in line with economists' target
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NEW YORK (CNNfn) - The U.S. economy shows signs of growth in the months ahead, about in line with analysts' expectations, according to a report issued Wednesday.
The index of leading economic indicators, a gauge of where the economy is headed, rose 0.3 percent in May, compared to a drop of 0.1 percent in April, the Conference Board reported. The May figure matched the consensus of analysts' forecasts as compiled by Reuters.
Meanwhile, the Chicago purchasing manager's index, a weathervane of manufacturing activity, rose to 60 in May, from 57.9 in the previous month. A level above 50 indicates an expanding economy.
The reports came as Federal Reserve Bank policy makers met for a second day to discuss whether to nudge up interest rates and put the brakes on a hot U.S. economy.
Many economists expect the Fed to boost the federal funds rate - the interest rate that banks use to lend to each other -- by one-quarter point to five percent. The Fed was expected to announce a decision at about 2:15 p.m. ET Wednesday.
"It seems to me that a five percent funds level is very reasonable," Wayne Angell, chief economist at Bear Stearns, said in an interview with CNNfn.
The bond market took the news in stride. The 30-year benchmark Treasury issue was down 7/32 in price, for a yield of 6.07 percent, shortly after those reports at 10 a.m. ET.
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Conference Board
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