Strong business expectations key to rising leading indicator

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Strong business expectations key to rising leading indicator

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Nebraska’s leading economic indicator rose again during February, according to the most recent report from the University of Nebraska–Lincoln.

The leading indicator, a composite of economic factors that predict economic growth six months into the future, rose by 0.38 percent. The February rise was the fifth-consecutive monthly increase.

“The increase suggests that moderate economic growth will continue in Nebraska through the third quarter of 2019,” said economist Eric Thompson, director of the Bureau of Business Research at the university.

For the second-consecutive month, strong business expectations were the primary reason for the jump in the Nebraska indicator. Respondents to the February Survey of Nebraska Business reported plans to increase both sales and employment over the next six months.

“Business expectations were at odds with other components of the leading economic indicator,” Thompson said.

Building permits for single-family homes declined during February while the value of the U.S. dollar also increased during the month. A higher U.S. dollar is challenging for manufacturers and other businesses that export.

The leading economic indicator report is produced monthly by faculty and students in the Bureau of Business Research in Nebraska’s College of Business.

Read the full report and a technical report describing the indicators.

Nebraska Bureau of Business Research Leading Economic Indicator – March 2019
Video: Eric Thompson discusses the February leading economic indicator report