A series of positive indicators ves-lerday suggested the US rcmimm remains weak, but is likely lo avoid a severe* downturn and may c onic oui of the doldrums soon, analysis said.

Ilie government reported ih.n consumer spending, a closdv watched measure of US economic health, rose* a sirongcr-than-cxpcctcd 0.7 per cent in January, while personal income gained 0 6 per cent.

US construction spending meanwhile rose an unexpected l."» pct cent in January, die strongest performance since March 2000.

And a key indicator ol US manufacturing, one ol the weakest segments of die economy, suggested that the decline could be over soon.

I he index of manufacturing activity by the National Association ol Purchasing Management

rose 0.7 points in Febi nary to 11.9. iL organisation said I hursdav.

I he figure indicates that manufacturing activity conlinm-d to slow in the I foiled Slates, hut al a s|ow< i pace than in Januarv. the NAPM said.

Any figure below 50 in the NAPM index indicates slowing manufacturing activity, while a figure above 50 suggests expan sion.

NAPM survey directed Norbert Orc said the report contained reason Im optimism.

"This could be an indication that the manufacturing sector bottomed in January, though we must caution that it takes mure than one month's data to make ihai determination," he said.

A close examination of (he data suggested that the US economy lemains sluggish.

I he NAPM said that based on historical data, its index would

iianslatc into a 0.3 pci cent decline in overall US economic ac-livilv lor (he months of January ami I el u nary.

And Merrill Lynch duel economist Bruce Steinberg noted dial die rise in personal income was skewed by a large amount of one-lime Hauslers, and otherwise was up just 0.1 per cent, and most of ih.n was eaten up by inflation.

I )avid ()i r of I iist Union said dial while die headline figures lor l>eisonal income and consumer spending looked encouraging, the hit from energy prices depressed the 'real' gains, with income and spending rising only 0.2 |)ei cent alter adjusting lot inflation."

On also cautioned dial these figures do not account lor die sleep declines in stock prices dial < otild dampen die so-called wealth elfecl" on consumer spending.

I )i. k Rippe, chief econom i : Prud< niiiil Securities, said Ihurs-daVs data suggests there is rea-son to think the overall econumv can do all right and. avoid rcces sion. even though the industrial scctoi is still declining."

"Ii would be nice il Januarv was the bottom. I think we are cer-lainly very close to the bottom, t mainly in terms of the auto sec-im." said Mike Carey. North \mcrican economist at Credit I yonnais in New Work.

Henry Wilhnore ol Barclays Capital said the data suggest a modest inflation-adjusted giowth of 2-2.5 per cent in spending lor the first quarter, and overall eco-nomic growth of 0.5 pci cent.

Another government report showed jobless claims lot the week ending February 21 lose 39.(100 to 372.000 - a sign that the et onomy is cooling and producing fewer new jobs.