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"For now, there is still a lot of good news on the economy," said Paul Edelstein, an economist at IHS Global Insight. "Home construction and demand are growing, and jobs are being added." The ISM report measures growth in industries that range from retail and construction to health care and financial services. Even with March's decline in the service-sector growth, the index nearly matched its 12-month average of 54.5. Fifteen of the 18 industries covered by the ISM survey reported expansion, including construction, transportation and warehousing, retail, finance and insurance, and utilities. And other reports suggest consumers are still spending, despite an increase in Social Security taxes that has reduced take-home pay. In February, consumer spending rose by the most in five months. And consumer confidence improved in March from the previous month, according to a survey released last week by the University of Michigan. The housing recovery has also boosted home prices, which makes homeowners feel wealthier. That can also lead to more spending. A third report Wednesday showed home prices rose 10.2 percent in February compared to a year earlier. The annual gain, reported by real estate data provider CoreLogic, was the biggest since March 2006. Prices have now increased on an annual basis for 12 straight months, underscoring the recovery's steady momentum.
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