Record Output

BUSINESS

The broadest indicator of the vitality of the U.S. economy is gross national product. Would it reach a spectacular half-trillion dollars ? Word went down from the White House to the statisticians: if it does, the announcement should be made by President Eisenhower himself. At week's end the news was out--and not announced by the President. Government economists reported that the output of goods and services in the first quarter of 1960 reached the record annual rate of $498 billion. Though running at the $500 billion mark by the end of the quarter, it fell just short of the happy round figure. The $498 billion G.N.P. rate was a gain of $14.5 billion over the fourth quarter of 1959, the biggest quarterly gain since 1950.

Consumer buying was also still on the rise. The Federal Reserve Board reported that department store sales rose to a new 1960 high for the week ended April 16, for 1960 as a whole are running 3% ahead of last year.

With the gains there were signs that prices were creeping up again. The Labor Department reported that the wholesale price index for the month of March had risen 0.6%, to 120% of the 1947-49 average. The March rise, the largest in the past two years (see chart) was caused primarily by bad weather, which brought an increase in the cost of foods. Labor Department experts expect that wholesale prices, along with consumer prices, will creep up more than 1% this year.

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