Leading Economic Indicators

China's economy expanded more than 11% for the fourth straight quarter, supporting global growth even as the threat of a recession looms in the U.S. Gross domestic product rose 11.2% in the three months ended Dec. 31, compared with 11.5% in the third quarter, the government statistics bureau said today in Beijing. About $7.6 trillion has been wiped off the value of stocks worldwide this year on concern that a slowdown in the U.S. will spread.

Worker productivity in the U.S. grew more than forecast in the fourth quarter as companies held down labor costs, a sign that inflation pressures might recede. Productivity rose at an annualized 1.8% rate slowing from a 6% pace in the third quarter, the Labor Department said Wednesday. The median forecast in a Bloomberg News survey of analysts was for a 0.5% gain.

Economic growth in Mexico accelerated faster than expected at the end of last year as a jump in the service sector helped the country shrug off a slowdown in the United States, its main trading partner. The Mexican economy grew at a 3.8% rate in the fourth quarter, the government said Tuesday. Economists see Mexico weathering a possible recession this year in the U.S., as expanding credit allows consumers to spend more.

U.S. mid-Atlantic factory production slumped to its lowest level since the last recession, while an index of future economic activity pointed to even tougher times ahead. The Philadelphia Federal Reserve's business activity index slumped to negative 24.0 this month -- the lowest since February 2001 -- from an already weak negative 20.9 in January.

The government said Friday that Americans spent more in January, not because they bought significantly more goods and services but because they paid more for what they did purchase. Consumer spending, which accounts for two-thirds of all economic activity, rose 0.4% in January from December, the Commerce Department said. That would normally be greeted as good news, demonstrating that people were buying things they wanted while powering the economy forward.

Confidence among U.S. consumers fell to a 26-year low after unemployment increased and gasoline prices surged, threatening the spending that accounts for more than two- thirds of the economy. The Reuters/University of Michigan preliminary index of consumer sentiment decreased to 63.2 this month. It was the weakest level since 1982, when the jobless rate approached 11%, the worst since the Great Depression.

Moving to stop the economy from stumbling further, the Federal Reserve said Friday that it would pump more cash into U.S banks to keep the nation's financial system from seizing up. The surprise action came as the Fed formally signed on to tough new rules for the credit card industry announced a day earlier by other regulators. The two initiatives were the latest examples of how the Fed, under the chairmanship of Ben S.

A private business group says its index of leading economic indicators inched higher for the second month in another sign that higher fuel and food prices, tighter credit and a depressed housing market are stifling the economy. Separately, the number of newly laid-off workers filing for unemployment benefits remained at worrisomely high levels despite dropping slightly last week. The New York-based Conference Board said Thursday that its gauge of economic indicators rose 0.

California's moribund construction and real estate industries helped push the state unemployment rate to 6.8% in May, its highest level in nearly five years. The state Employment Development Department reported Friday that joblessness in May rose six-tenths of a percentage point from the previous month and was a dramatic 1.5 percentage points higher than in May 2007. And the outlook is likely to get worse for California -- at least for the rest of the year, experts said.

The economy's health improved for the first time in five months in September as supplier deliveries and new orders strengthened, a private research group said Monday. The New York-based Conference Board said its monthly forecast of future economic activity rose 0.3%, a better reading than the 0.2% drop expected by Wall Street economists who were surveyed by Thomson/IFR. The index had fallen a revised 0.9% in August and 0.7% in July.