A monthly survey shows signs of improvement in the Midwest economy. Creighton University economist Ernie Goss compiles the Mid-American Business Conditions Index.
“For the first time since July, the overall index is above growth neutral,” Goss said.
Supply managers in Iowa and eight other Midwest states are surveyed each month and the results are compiled into indexes ranging from zero to 100. Any score above 50 suggests economic growth. The overall index has now increased for two consecutive months.
“The index was 50.5 (in February), up from 48.3 in January, so that’s moving in the right direction,” Goss said.
A strong U.S. dollar and weakness among the nation’s chief trading partners remains a restraint on regional growth, according to Goss. “The economy is stabilizing in the manufacturing sector and I expect the overall economy for the nine states…to move positively, but not as positively as we’d like to see,” Goss said.
The survey found a lot of concern about a potential Federal Reserve rate hike later this month. “A little more than one-fourth of the businesses said a March Federal Reserve rate hike would negatively affect their business,” Goss said. “That’s a little bit of a concern since I believe we may get a rate hike.” Goss is predicting there’s a 60-percent chance that the Federal Reserve will move to bump up interest rates in a couple weeks.
Photo courtesy of Creighton University.