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Midwest Economic Survey Points To Slow Growth

2 min read

OMAHA, Neb. – Figures from a survey of supply managers in nine Midwest and Plains states have dropped slightly but still suggest economic growth ahead, according to a report issued Friday.

The Mid-American Business Conditions index hit 50.1 in June, compared with 52.1 in May, the report said. The index generally has been on the rise since dropping to a 12-month low of 39.6 in December.

“The region’s manufacturing sector is expanding, but at a slow pace as gains for nondurable-goods producers more than offset continuing losses for regional durable-goods manufacturers,” said Creighton University economist Ernie Goss, who oversees the survey.

Most survey participants completed the survey before voters in Great Britain opted to leave the European Union. In 2015 the Midwest and Plains region exported almost $2 billion in goods to Great Britain and imported about $1.9 billion.

A subsequent British recession or weak British currency would not have a significant impact on the nine states’ economy, but the region would benefit from the strengthening of the dollar against a broad range of currencies, Goss said.

The survey results are compiled into a collection of indexes ranging from zero to 100. Survey organizers say any score above 50 suggests economic growth. A score below that suggests decline. The survey covers Arkansas, Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, Oklahoma and South Dakota.

The regional employment gauge fell last month to 46.1 from May’s tepid 51.4.

“While the region’s manufacturing sector has lost jobs over the last several months, the overall regional economy continues to add jobs but at a pace of roughly half that of this time last year,” Goss said.

Arkansas’ overall index for June fell to 48.5 from May’s 52.7. Components of the index were new orders at 45.6, production or sales at 46.5, delivery lead time at 53.0, inventories at 52.1 and employment at 45.3.

In 2015, Arkansas exported $170 million in goods to Great Britain, representing less than 0.14 percent of the state’s gross domestic product. Thus, Goss said, significant increases in the value of the dollar versus the pound sterling or a British recession would do only small harm to the Arkansas economy.

(Copyright 2016 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)

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