WASHINGTON, May 4: The US government's chief economic forecasting gauSe plunged one per cent in Mardh, the fworst decline since the middle of the. recession more than two years ago, the Commerce Department, said Tuesday, says AP.

The drop, slightly steeper than predicted by analysts, was a sign of the dramatic slowdown that has gripped the economy this year, compared with a brief period of robust growth late last year.

The decrease was the worst since November 1990. It followed a modest 0.6 per cent increase In February and a slight 0.1 per cent decline In January. In December, at the end of the US economy's strongest quarter in five years, the Index of Leading Indicators had leapt 1.7 per cent, the beat in a decade.

The index is designed to predict economic activity six to nine months in advance.

Three consecutive declines are a good, although far from foolproof, sign of a recession ahead.

Analysts do not export the economy to slip back Into recession this year. However, they warn that growth Is unlikely to reach the fourth quarter rate — 47 per cent as measured by the gross domestic product — anytime soon

Last week, the department reported first quarter GDP growth at an anemic 1.8 per cent.

"We re In a very subdued economy. There's nothing very buoyant going on." said economist Laurence H. Meyer, a St Louis- based consultant.

In a speech Monday, Treasury Secretary Lloyd Bentsen blamed the severe mid March storm for much of the first quarter's weakness, calling the quarter "a winter pothole on our road to recovery.'

However, economist Sung

Won Sohn of Norwost Corp, in Minneapolis said the weather can explain only part of the economy's recent slippage.

The economy is kind of scraping the bottom right now," he said. The fundamental problem is the economy isn't creating enough jobs to support the kind of spending necessary to have even moderate economic growth.'

In March, nine of the index's forward-looking Indira tors declined. In order of their effect on the Index, from largest to smallest, the nega tive Indicators were:

— A decline in building permits.

— A rise In new claims for unemployment benefits, from a weekly average of 343.000 In February to 376.000 In March.

— A decrease In the average work week at factories, from 41.5 hours tn February to 41.2 in March.