A survey of economic trends in the Midwest advanced last month, indicating improved economic growth in a nine-state region in the coming three to six months.
Supply managers in the survey said they expect inflation of only 2 percent this year and reported the fastest growth in new orders in two years, which Creighton University economist Ernie Goss called “very positive signals.”
Asked about the effects of deficit-related cuts in federal spending, about three-fourths of those surveyed reported no impact, one-fourth reported modest effects and none reported significant effects, Goss said Monday. A month earlier, many had said they expected the cuts to hurt their businesses.
The monthly survey for Arkansas, Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, Oklahoma and South Dakota gave a Mid-America Business Conditions Index of 58.2 on a 100-point scale, with indexes above 50 showing economic growth. The index was 53.1 in February.
Nebraska’s index was 53.4, up from 48.7 in February. New orders, production and sales, delivery time and inventories showed growth, but the inflation index was 48.1. Goss said production was especially strong for metal manufacturers and farm equipment and food producers.
Iowa’s index was 65.5, up from 64.6 in February and the highest in the region. New orders, production and sales, delivery time, inventories and employment all showed growth due to what Goss called “very broad-based business gains,” including jobs and average hours worked.
For the region, Goss said that he expects increased job growth but that it would take several consecutive increases before he is confident of sustained growth. The index was below 50 in January, and an increase in new orders — yielding an index of 65.4, up from 55 in February — was the main factor in the new survey’s higher index.
Other parts of the index: employment, 56.3, up from 51.6 in February; wholesale prices, 64.1, down from 72.6; confidence, 58.2, up from 50.6; inventories, 58.1, up from 52.2; exports, 50.9, up from 49.2; imports, 55, up from 53.7; production or sales, 62.4, up from 55.5; and delivery lead time, 49.0, down from 51.1.
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