January results from a survey of supply managers in nine states in the Midwest and Plains suggest some improvement in the regional economy, but the conditions apparently didn’t engender much optimism from those surveyed, according to a report released on Feb. 1.
The Mid-American Business Conditions report said the overall index jumped to 48.3 in January from 39.5 in December — the first increase in six months. But looking ahead six months, economic optimism — as reflected by the survey’s January business confidence index — fell to 42.2 from December’s 49.1.
“Falling agriculture and energy commodity prices, along with global economic uncertainty, continues to restrain supply managers’ expectations of future economic conditions,” said Creighton University professor Ernie Goss, who oversees the survey.
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, and a score below that suggests decline. The survey covers Arkansas, Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, Oklahoma and South Dakota.
The stronger dollar, which makes U.S. goods less competitively priced abroad, and economic weakness among the nation’s chief trading partners have “squeezed and will continue to squeeze U.S. and regional manufacturers,” Goss said.
The index for new export orders was a weak 40.0 in January but was up from 33.8 in December, the report said.
“Since October of 2015, the value of the U.S. dollar has expanded by more than 8 percent against the Canadian dollar,” Goss said. “The No. 1 export market for each state in the Mid-America region is Canada, and this will put downward pressure on regional exports,” he said.