Trade worries seem to be weighing on the Nebraska economy.
The latest report from the Bureau of Business Research at the University of Nebraska – Lincoln indicates the state economy will continue to grow through the remainder of the year, though at a slower pace.
Bureau Director Eric Thompson says current trade threats could become a factor.
“Exports are quite important to Nebraska agriculture,” Thompson tells Nebraska Radio Network affiliate KLIN. “So, if increases in trade friction cause export activity to fall that could be a significant negative for our agricultural sector.”
Thompson says trade tension between the United States and China, among other countries, overshadows any forecast of the economy’s direction.
Other trade worries add to that.
The U.S. dollar, already strong, continues to rise, which makes Nebraska exports more expensive abroad.
The leading economic indicator compiled by the bureau forecasts economic growth over the next six months, but at a slower rate than earlier in the year.
Thompson says the pace of economic growth has been slowing the past few months.
Other factors in the indicator are encouraging. Business and consumer confidence remains strong, according to Thompson. Business owners and managers indicate they expect increased sales which should lead to an increase in their workforce. Airline business remains strong. Initial claims for unemployment continue to fall.
Building permits for single-family homes fell slightly in May.
Despite the worries, the state economy continues to move ahead.
“There’s solid consumer and business confidence,” Thompson says. “So, that is positive for growth in our state economy and it will kind of be a tug of war, I think, between that fundamental confidence and what’s going on in terms of international trade here over the next few months.”
Click here for the full Bureau of Business Research report.
Jane Monnich, KLIN, contribute to this report.