The index of leading economic indicators fell 0.4%, according to the Conference Board. The reading is intended to predict economic activity in the next 3-6 months.
Analysts were expecting a drop of 0.6%, according to a consensus of economists surveyed by Briefing.com.
The index rose unexpectedly in the prior two months. A revised uptick of 0.1% in January (correct) followed a jump of 0.2% in December.
The measure is based on 10 components, six of which increased in February: interest rate spread; index of supplier deliveries; building permits; real money supply; manufacturers' new orders for consumer goods and materials; and manufacturers' new orders for nondefense capital goods.
Some of those six indicators enjoyed surprising upticks in recent economic data.
Housing starts unexpectedly surged 22% February, after falling for eight months. It was the first time housing starts increased since June.
Declines: The remaining four components declined: average weekly initial claims for unemployment insurance; stock prices; index of consumer expectations, and average weekly manufacturing hours.
The components in decline aren't surprising after a slew of negative reports.
The number of people filing initial claims for unemployment benefits fell slightly last week, but continuing claims hit a fresh record high of more than 5.47 million.
The unemployment rate is up to 8.1%, the highest level in 25 years.
Stock prices rallied last week, but the Dow Jones industrial average is still down almost 50% from its peak in October 2007. Consumer confidence fell to a three-month low in February.
Fed takes action: The Federal Reserve in recent months has taken several steps to boost the financial system.
The Fed said Wednesday said it would spend up to $300 billion over the next six months to buy long-term Treasurys, a move designed to free up credit.
The Fed also announced plans to buy an additional $750 billion in mortgage-backed securities in an attempt to lower mortgage rates. The benchmark lending rate remained unchanged, as it was already at a record-low range of 0-0.25%.
It's hoped that these actions will inject liquidity into the credit markets and spark lending.
-- An earlier version of this story did not note the January revision. CNNMoney.com regrets the error.
Business briefs: Mortgage rates are lowest on record
Delay on credit card rules draws fire
Jobless claims dip in latest week
