PROVIDENCE – An index of Rhode Island’s leading economic indicators continued steady growth in October.
The Providence Business News/e-forecasting.com index for the state rose 0.5 percent to 113.8 in October, compared with 0.3 percent growth in September. A reading of 100 is equivalent to the state’s economic activity in 2000.
October was the sixth consecutive month that the index grew by less than 1 percent. The index has posted increases since May 2009.
The leading indicators index uses nine published statistics to forecast the direction of the state’s economy over the next three to six months, with positive numbers signaling growth and negative numbers signaling contraction.
In October, six of the nine components made a positive contribution to the index. Weekly hours in manufacturing rose 0.16 percent; building permits, 1.32 percent; manufactured exports, 0.10 percent; national stock prices, 4.32 percent; the interest rate spread, 0.02 percent; and the national orders index, 0.54 percent.
Consumer expectations, dropping 3.49 percent, was the largest negative contributing factor along with the state employment barometer (no change) and unemployment claims (worsening 0.49 percent).
The index’s six-month, annualized growth rate was 9.2 percent in October, continuing a downward trend. September’s six-month leading indicator was 10.2 percent, while August’s was 11.7 percent and July’s 13.2 percent. The half-year growth rate has been falling off a high of 17.8 percent in April.
The long-term annual growth rate for the state is seen as 2.1 percent, e-forecasting.com said.
The index also showed adjusted data from previous months. September’s index was revised from 115.1 and 0.4 percent growth to 113.2 and 0.3 percent growth.
