Midwestern economy continues slow growth

Regional supply chain managers say the economy continues to slowly grow, according to Creighton University's June Business Conditions Index. .The index, which tracks the sentiments of supply chain managers in nine Midwest states, fell by half a point to 50.8, its fifth straight month of being above the growth-neutral mark of 50. ."Creighton's monthly survey of manufacturing supply managers over the past several months is now pointing to positive but slow growth with significantly lower inflationary pressures at the wholesale level," said Ernie Goss, director of Creighton University's Economic Forecasting Group and the Jack A. MacAllister Chair in Regional Economics in the Heider College of Business..The index tracking wholesale inflation fell to 67.4 from 74 in May. Supply managers expect wholesale prices for the services and products their firm purchases to increase by 0.7 percent over the next six months. .Goss expects the Federal Open Market Committee to raise short-term interest rates by 0.25 percent later this month. "While it's too early to tell if the Federal Reserve is achieving its 'soft landing,' results from Creighton's surveys over the last several months are somewhat promising on the inflation front, but with waning economic growth," Goss said. .The regional index for hiring fell to 50 from 52.3 in May. According to the U.S. Bureau of Labor Statistics, regional employment increased by 2.1 percent over the past 12 months while overall U.S. employment grew by 2.7 percent..The index for economic confidence increased three points to 32.6 as nearly half of supply managers expect the pace of growth to fall in the next six months. The index tracking levels of raw materials and supplies fell seven points to 52.2 as manufacturing firms continued expanding inventory levels. . "Employment growth and levels remain solid due to manufacturers' labor hoarding," Goss said. "That is, manufacturers in the region are maintaining employment levels due to a fear of an inability to hire back once business activity levels pick up." .Trade numbers were weak in June, with new export orders falling four points to 42.3. Imports increased to 58.3 from 52.8 in May. According to the U.S. International Trade Association, regional exports increased 5.2 percent over the first four months of the year to $35.3 billion from $33.5 billion in 2022.