A gauge of future US economic activity rose to a 3.5-year high in January on solid gains in manufacturing, the Conference Board said today, pointing to steady momentum in the economy.

The group's Leading Economic Index increased 0.4 per cent to 94.9, the highest level since July 2008, after an upwardly revised 0.5 per cent gain in December. January marked the fourth straight month of gains.

Economists polled by Reuters had expected the index to increase 0.5 per cent after a previously reported 0.4 per cent rise in December.

"Recent data reflect an economy that started the year on a positive note," said Ken Goldstein an economist at the Conference Board. "The LEI suggests these conditions will continue and could possibly even pick up this spring and summer."

Data ranging from employment to manufacturing and retail sales, so far suggest the economy retained much of the momentum from the final three months of 2011, leading analysts to tone down expectations of slower growth this quarter.

Reuters