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WASHINGTON (AP) — The economy turned in a lackluster first half of the year and a forward-pointing index likely showed little strength in August.
The Conference Board's Index of Leading Indicators is expected to show a slight decline of 0.1 percent in August, according to a survey of economists by FactSet.
The index, which is designed to forecast economic conditions three or six months in the future, showed a 0.4 percent gain in July after falling 0.4 percent in June.
The index of leading indicators is a compilation of 10 forward pointing indicators.
The overall economy grew at an annual rate of 1.7 percent in the April-June quarter, an even weaker showing than the 2 percent growth rate in the first three months of this year.
Last week, the Federal Reserve announced that it was launching a third round of buying. The new program, unlike the previous two rounds of bond purchases was left open-ended. The central bank said it would purchase $40 billion in mortgage-backed bonds and keep the program going until it saw a substantial improvement in the economy.
The Fed's goal is to push mortgage rates and other long-term rates lower in an effort to get the economy growing at a fast-enough pace to make a significant improvement in the labor market. The economy is expected to grow at a sub-par rate of around 2 percent for the rest of this year, not fast enough to push unemployment significantly lower. It is currently at 8.1 percent.
The Fed's announcement last week is designed to jump-start activity but there are plenty of doubters who argue that with interest rates already at rock-bottom levels, another round of bond buying will not lower rates enough to make much of a difference. They warn that pumping more money into the economy runs the risk of future inflation.
But Fed Chairman Ben Bernanke said the Fed's latest actions will make a difference and the central bank held out the prospect of doing even more if needed to get the economy moving.
In an updated economic forecast, the Fed said it expected growth to be no stronger than 2 percent for all of 2012, down from a previous forecast in June of 2.4 percent growth this year.