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Data reveal mixed economy
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September 1, 1998: 10:51 a.m. ET
Leading index beats forecasts, but manufacturing, construction are slow
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NEW YORK (CNNfn) - The U.S. economy remains strong although some areas are growing at a slower pace than expected, according to three economic indicators.
The index of Leading Economic Indicators, which indicates future trends in the U.S. economy, climbed slightly higher in July than Wall Street estimated, the Conference Board said Tuesday.
The July LEI figure, comprised of 11 components ranging from average length of workweek to total money supply, rose 0.4 percent in July, compared with June's 0.2-percent decline. Economists had forecast a 0.3-percent hike.
Manufacturing contracts again
America's manufacturing sector contracted for the third consecutive month in August, the National Association of Purchasing Management said.
The purchasing managers' index, a broad gauge of overall activity in the nation's manufacturing industries, inched up to 49.4, an increase of 0.3 from July's 49.1 level.
Economists had forecast a strong 50.3 level. The purchasing managers' index has contracted since June after 22 consecutive months of growth.
An index number above 50 generally indicates the economy is expanding, whereas anything below 50 indicates contraction. The data are based on replies to survey questionnaires by purchasing executives in more than 350 industrial companies.
The new orders index grew to 50.9 percent, while the purchasing managers' index of order backlogs slowed from July to 48.5 percent. The production index grew to 50.3 percent.
"The overall picture in August is one of slow paced decline in manufacturing activity," Norbert Ore, chair of the NAPM's Business Survey Committee. "New orders are still growing, but at a slower rate."
Construction spending
Spending on the nation's building activity posted a lower-than-expected gain in July, according to the Commerce Department. Construction spending rose 0.4 percent to a seasonally adjusted annual rate of $650.4 billion.
Although economists had forecast a 0.7-percent gain, July's total construction level represents a record high. July's figure compares with a revised 2-percent hike in June.
Spending on new residential housing gained 1 percent to an annual rate of $211.2 billion. Nonresidential construction slipped 1 percent to a rate of $166.2 billion.
The benchmark 30-year Treasury bond fell 16/32 for a yield of 5.27 percent. 
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