Inflationary pressures remain elevated, while the overall index for the Mountain States region has slipped.
The November Business Conditions survey of supply managers and business leaders for Colorado, Utah and Wyoming shows the overall Business Conditions Index slumped to 56.6 from October’s 63.3 and September’s 64.8.
“The Mountain States region will continue to expand even as the national economy moves closer and closer to recessionary economic conditions,” said Ernie Goss, a professor of economics at Creighton University. “Industries with linkages to the region’s large mining and natural resources industries continue to experience healthy business growth with oil prices approaching $100 per barrel in November. Even so, our survey points to slower growth in the months ahead.”
The employment index for the region slipped to a still healthy 59.1 from 60.6 during October. Pushed higher by rising oil prices, the inflation gauge indicates lofty inflationary pressures in the economic pipeline even as the economy slows.
“The prices-paid index, which tracks the cost of raw materials and supplies, advanced to 82.2 from October’s elevated 79.4,” Goss said. “The Federal Reserve’s rate setting committee meets again Dec. 11, and I place the likelihood of a rate cut at close to 100 percent.”
Looking ahead six months, supply managers’ economic optimism, captured by the confidence index, declined to 40.9 from 50 in October and 60 in September.
Trade numbers improved in November. New export orders advanced to 59.4 from 55.6 in October. Imports dipped to 49.2 from October’s 50.
Other components of November’s Business Conditions Index were new orders at 50, down from October’s 67.2; production at 59.1, down from 63.7; inventories at 54.5, down from 59.1; and delivery lead time at 63.6, up from 61.
The overall index ranges between 0 and 100. An index greater than 50 indicates an expansionary economy during the course of the next three to six months.
Colorado’s Business Conditions Index for November declined from October’s vigorous reading.
The index, a leading economic indicator from a survey of supply managers and business leaders dipped to 61.9 from 65 in October and 66.7 in September. Components of the overall index for November were new orders at 50, production at 62.5, delivery lead time at 75, inventories at 50.1, and employment at 59.1.