A closely watched gauge of future U.S. economic activity rose slightly for the second consecutive month, but the report by a private business group still showed that higher fuel and food prices, tighter credit, and a depressed housing market are slowing the economy. Separately, the number of Americans filing new claims for jobless benefits remained at high levels, even as it declined slightly last week. The Conference Board said Thursday its index of leading economic indicators rose 0.1 percent in May, matching analysts' expectations as well as the rate of increase in April. The index is designed to forecast economic activity in the next three to six months. “The economy is very weak heading into the summer, with gas[oline] and utility bills possibly heading even higher,” said Conference Board economist Ken Goldstein. “But latest data suggest the economy has not fallen into a contraction and may not undergo one in the second half of the year.” Meanwhile, jobless claims fell by 5,000 last week to 381,000, after surging by 27,000 the previous week, the Labor Department said. Last week's small improvement was not enough to keep the four-week moving average from rising to 375,250, pushing it close to the level reached in early April, when the average had soared to highs not seen since the wave of layoffs following the 2005 Gulf coast hurricanes.
