A monthly survey of business leaders suggests that economic conditions continued to improve last month for nine Midwestern and Plains states, according to a report released Wednesday.
The Mid-America Business Conditions Index rose to 58.8 in October from 58.2 in September and 57.5 in August, the report states.
"Both the national and our regional indices indicate the manufacturing sector is expanding at a very healthy pace and that this expansion will spill over into the broader national and regional economies in the next three to six months," said Creighton University economist Ernie Goss, who oversees the survey.
The survey results are compiled into a collection of indexes ranging from zero to 100. Survey organizers say any score above 50 suggests growth in that factor. A score below that suggests decline. The survey covers Arkansas, Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, Oklahoma and South Dakota.
The regional wholesale inflation gauge fell to a still lofty 75.0 from September's six-year high of 79.6, continuing to reflect inflationary pressures.
"Given elevated inflationary reading(s) from our surveys and government surveys over the past several months, I expect the Federal Reserve to raise short-term interest rates next month," Goss said. "This increase will not dampen economic activity in the region to any great extent."
The economic optimism index rose slightly last month to 63.8, compared with 63.6 in September.
"Healthy profit growth, still-low interest rate, and an improving global economy boosted the economic outlook among supply managers in the nine-state region," Goss said.
The regional new-export orders index was unchanged from September's solid 54.3, and the import index rose to 58.6 in October from 53.8 in September.
"Expanding regional growth spurred purchases of inputs from abroad, while growth among important trading partners maintained the export orders at a positive level," the economist said.