Indicators say
state economy gaining

For only the 2nd time
in 2 years, the leading economic
indicators show an increase

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Associated Press

The state's economy could be gaining ground, according to the state's index of leading economic indicators reported yesterday.

The Department of Business, Economic Development and Tourism said the index was up in February -- only the second upturn since July of 2000. There also was a slight improvement in the index in November, breaking out of an 18-month downturn.

While the February upturn is encouraging, one month does not make a trend, said department Director Seiji Naya.

"We need to have a few additional months of improvement in the index before we can anticipate an upturn in our local economy with any confidence," he said.

The LEI index is designed to anticipate changes in the direction of Hawaii's economy five to 10 months ahead. A rise signals faster growth and a decline signals slower growth.

Six of the 10 indicators were positive in February, including real estate activity, strengthening indicators of national economy and improvement in Japanese labor earnings.

The national economy was bolstered by improvement in the interest rate environment and an increase in Pacific-region consumer confidence.

Four local indicators remaining negative in February included initial claims for unemployment and average working hours, both of which have been negative since October 2001.

Declines in the value of the Japanese yen and a slight decrease in the value of Hawaii building permits were also a drag on the LEI, the department said.

However, "a stronger local economy would certainly be consistent with a number of positive signs we are seeing locally, nationally and internationally," Naya said.