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Pastimes : The Naked Truth - Big Kahuna a Myth -- Ignore unavailable to you. Want to Upgrade?

To: Joseph G. who wrote (5132)	9/3/1998 7:22:00 PM
From: yard_man	Read Replies (1) \| Respond to of 86076

Pretty big drop for US, though. biz.yahoo.com OCUS-U.S. service businesses lose steam in August By Glenn Somerville WASHINGTON, Sept 3 (Reuters) - A gradual slowing in U.S. economic activity seen in fading sales of manufactured goods to distressed Asian and other overseas nations spread to service businesses in August, a key industry survey showed on Thursday. The National Association of Purchasing Management said its index of growth in the nation's non-manufacturing sector showed a slower rate of growth for a third straight month in August. The gauge fell to 52.0 from 57.5 in July, mirroring the performance of manufacturers, who reported separately on Tuesday that their business had weakened for a third consecutive month in August. ''I think it portends slower growth in the upcoming months,'' said Ralph Kauffman, head of the group's Business Survey Committee. Only 24 percent of the non-manufacturing companies surveyed said their August business had picked up, the smallest proportion in seven months, since 23 percent last December. Some U.S. business lobby groups, like the National Association of Manufacturers, have called for Federal Reserve policy-makers to cut U.S. interest rates. The business group says cheaper U.S. credit would stimulate the global economy by making it easier for Asia, Russia and Latin America to attract capital and keep it from flowing to the United States in search of higher returns. But a survey by Reuters of 14 analysts at major investment banks in New York, London and Tokyo, published on Thursday, found 10 of them expected the U.S. central bank to sit tight through 1998 as it assesses the U.S. economy's direction in light of foreign financial unease and outright recession in Asia. ''Until we see some slowing in domestic spending, they'll be reluctant to ease,'' predicted economist Jim O'Sullivan of J.P. Morgan and Co. Inc. in New York. Fed policy-makers are next slated to consider interest-rate policy on Sept. 29 and have two more scheduled meetings this year after that, in November and December. Separate government reports on Thursday showed the U.S. economy was still relatively vigorous at the beginning of the third quarter, in contrast to much of the rest of the world. The Commerce Department said homebuilders, scrambling to meet demand, completed new homes at the fastest rate in nearly 1-1/2 years during July. New homes were being made ready for sale and occupancy at a rate of 1.53 million a year, up 3.5 percent from June for the fastest annual rate since 1.57 million in February 1997. Another report from the Labor Department said new claims for jobless pay last week edged up 1,000 to 302,000 -- a level that analysts described as ''extremely tight.'' Economist Maureen Maitland of Donaldson, Lufkin & Jenrette Securities Corp. in New York noted that the four-week moving average of claims, at 302,250 in the week ended Aug. 29, was at its lowest in nearly a year. Fed officials have worried about the risk of inflation sparked by higher wage demands as labor scarcities grow in many industries like homebuilding. So far, there has been little evidence to suggest widespread demands for higher pay, though another Labor Department report on Thursday, on productivity, showed a pickup in second-quarter wage costs. The department revised its earlier estimate of productivity, or output per worker, in the April-June quarter to show a seasonally adjusted annual 0.1 percent rise instead of the 0.2 percent decline it originally reported. That was still sharply below the first quarter's 3.5 percent increase. Productivity rates are a gauge of the economy's health. Gains generally mean that businesses are operating more efficiently, so that corporations can boost workers' pay without raising their overall costs or hurting profits. Unit labor costs, a closely watched indicator of inflation pressure in the economy, rose 3.9 percent -- revised downward from the originally reported 4.1 percent gain but still far above the 1.1 percent gain recorded in the first three months.