Does contraction loom for Iowa economy?
BUSINESS RECORD STAFF Oct 2, 2015 | 7:57 pm
1 min read time
207 wordsAll Latest News, Economic DevelopmentAn index of state economic activity continues to point toward a coming contraction, according to a release from the Iowa Department of Revenue.
A six-month annualized change in the Iowa Leading Indicators Index below negative 2 percent and a six-month diffusion index that is less than 50 amount to the tea leaves that the revenue department officials are reading.
“The weakness is stemming largely from Iowa’s agricultural sector (with a spillover) into manufacturing,” according to the revenue department report. “The widespread weakness across the index components in August suggests future softness in Iowa’s overall economy. One of the most visible negative components in August was the stock market swoon that experts are referring to as a correction event.”
Indexes for agricultural futures profits, diesel fuel consumption, Iowa stocks, new orders and residential building permits each declined more than 0.05 percent over the last half year. Average manufacturing hours fluctuated between 0.05 percent and negative 0.05 percent, the department said.
The Iowa Leading Indicators Index decreased to 107.1 in August from 107.5 in July. The monthly diffusion index increased in August to 25 from 12.5 in July, with two of the eight components experiencing positive changes.
Average manufacturing hours and average weekly unemployment claims were the positive contributors.
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