The composite leading index rose by 1.1% in August, after a 0.6% gain in July, Statistics Canada said Thursday.

The increase was the largest since April 2002, a sign the economy is in the early stage of a recovery.

“Growth in the leading index usually only exceeds 1% early in the recovery from a downturn,” Statistics Canada said.

In August, eight of the 10 components contributed to the advance, up from five the month before, as the manufacturing sector joined the advance.

The housing index rose by 3.1% after sizeable gains in June and July.

Consumer spending for other durable goods also continued to expand, even before auto sales rose sharply in July, StatsCan said.

The Toronto stock market continued to trend upwards for the fifth straight month.

The leading indicator for the United States continued to recover, up 0.7% for its third straight gain.

Both housing and manufacturing turned up after prolonged slumps.

New orders for durable goods manufactured in Canada rose 8.1% as summer began, its largest gain on record following marked declines in each of the previous seven months. Transportation equipment led the gain.

Services employment remained on a steady downward trend, falling 0.2%, due to declines in both personal and business services.

IE