The Iowa Leading Indicators Index increased to 105.6 in March from 105.2 in February after three months of the index remaining unchanged.

A six-month annualized change in the index below -2.0% and a six-month diffusion index below 50.0 are considered a signal of a coming contraction when seen together.

The six-month annualized change was above a contractionary signal for the first time after 13 straight months of contraction signals as the Iowa Leading Indicators Index decreased 0.4% during the six-month span through March, an annualized rate of -0.7%.

The six-month diffusion index decreased to 25.0 in March from 37.5 in February, meaning it remained in a contractionary signal for the 15th month in a row.

The monthly diffusion index decreased to 43.8 in March from a revised 62.5 in February. A diffusion index measures the proportion of components rising in a given time period. Components are assigned values based on how they increased or decreased over the time period and the assigned values for all the components are then added together.

The Iowa nonfarm employment coincident index recorded a 0.12% increase in March.

Three of the eight components increased month over month in March: Diesel fuel consumption, the Iowa Stock Market Index and average manufacturing hours. The agricultural futures profit index, the new orders index, residential building permits, average weekly unemployment claims and the national yield spread detracted from the index.

Diesel fuel consumption increased 37.7% between March 2023 and March 2024. The 12-month moving average increased to 65.57 million gallons in March from 64.14 million gallons in February.

During March, 18 of the 28 Iowa-based or Iowa-concentrated publicly traded companies gained value, and six of the 10 financial-sector companies increased. With nearly two-thirds of the stocks experiencing gains, the stock market index increased to 131.6 in March from 123.7 in February.

The 12-month moving average of average weekly manufacturing hours increased to 39.75 in March from 39.66 in February. In March, average hours were 40.0, around three-quarters of an hour below the historical monthly average.

The yield spread remained in inversion territory (below 0) in March at -1.26%, down from -1.23% in February. March is the 17th month in a row that the yield spread has been in inversion. The long-term rate remained unchanged while the short-term rate increased by 3 basis points.

In March, the 12-month moving average of average weekly unemployment claims rose from 2,350 to 2,377. Unemployment claims were 19.8% above March 2023 claims, but 52.1% below average historical claims for March.

Residential building permits were 917 in March, down from 1,048 last year. The 12-month moving average decreased to 911 in March from 922 in February. March 2024 permits were 12.5% below March 2023, and 13.3% below the monthly historical average.

The new orders index in March declined to 48.5 from 49.6 in February. The 12-month moving average of the new orders index has decreased to 49.1 from 49.7 in February.

During March, the agricultural futures profit index showed expected profit decreases in both crop commodities and expected profit increases in both livestock commodities. Compared with last year, new crop corn prices were 16.7% lower while soybean prices were 11.3% lower. The March crush margin for cattle increased 5.5% from February while the crush margin for hogs increased 0.4%.

The full report is available online.