A monthly economic indicator from the University of Nebraska-Lincoln is pointing to a slowdown in economic growth later this year.
The leading economic indicator, a composite of factors that predict economic growth six months into the future, rose by just 0.26 percent during May.
It was the smallest increase in the indicator since October, and likely means the state's growth will slow in the fourth quarter.
“While the leading indicator has risen every month during 2018, the pace of monthly increases is declining,” economist Eric Thompson, director of the Bureau of Business Research at UNL, said in a news release. “The Nebraska economy will continue to expand, but at a slower pace.”
A rising U.S. dollar is the primary factor limiting growth in the leading indicator. “There was a sharp increase in the value of the U.S. dollar during May, which adds to the pressure on businesses which export,” Thompson said. There also was a modest decline in building permits for single-family homes in May.
Business confidence was the main reason the leading indicator still rose slightly. Respondents to the May Survey of Nebraska Business reported plans to increase both sales and employment at their businesses over the next six months. There also was an increase in manufacturing hours and airline passenger enplanements during May and a drop in initial claims for unemployment insurance.
The leading economic indicator report is produced monthly by faculty and students in the Bureau of Business Research in Nebraska’s College of Business.
The full report is available at the Bureau of Business Research website, bbr.unl.edu.