U.S. recovery to be vigorous

Press, 2 July 1983, Page 23

U.S. recovery to be vigorous

NZPA Washington The United States Government’s main barometer of future economic trends posted another solid gain in May, the Commerce Department announced, supporting President Reagan’s newfound confidence in the economy. The 1.2 per cent May advance in the Index of Leading Indicators was the 11th consecutive monthly rise and has foreshadowed the recovery from recession which began earlier this year and is “now gathering strength and breadth,” the Commerce Secretary, Mr Malcolm Baldridge said. “Recent behaviour of the index suggests that the recovery will remain vigorous

in the months ahead,” the secretary said in a statement after the department released the report. Seven of the 11 separate economic components included in the composite index for May helped to fuel the over-all increase. Although that showing was impressive, it was not as broadly-based as April when 10 of the 12 individual indicators contributed to that month’s 1.4 per cent rise. “We’ve begun a strong and steady recovery,” President Reagan told a meeting of the National Vocational Industrial Clubs of America in Louisville. “You can look to a future that is bright with hope, and

I will do everything in my power to ensure that the big spenders and big taxers in Congress won’t steal it from you.” President Reagan opened the televised press conference by saying that the economy was “beginning to sparkle.” The higher growth estimate was the second in two months and represented a sharp shift away from the Administration’s previous caution that the recovery could be easily derailed. Last month’s gain pushed the leading index to 154.5 (base, 1967). In April the index stood at 152.6 and in May last year 136.2. Net business formation .contributed most to the in-