Ukraine war, inflation hurt business outlook in Minnesota, 8 other states
Worries about Russia's invasion of Ukraine and other concerns undermined the confidence of business leaders in nine Midwest and Plains states, according to a new monthly report released Tuesday.
The report's confidence index fell to its lowest point ever in February when it hit 19.5, falling from January's already low 36.2. The indexes in the report range from 0 to 100 with any score below 50 suggesting a negative outlook. A score above 50 suggests optimism or growth in an index.
“Concerns about the impacts of the Russia-Ukraine war, higher interest rates, soaring inflation, and supply chain disruptions combined to hammer business confidence,” said Creighton University economist Ernie Goss, who oversees the survey.
Businesses are worried that the war in Ukraine will worsen the ongoing supply chain problems and push commodity prices higher, Goss said.
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The outlook for the next six months turned especially negative in February even though manufacturing activity continues at a healthy pace in the region today. The overall economic index for the region improved to 64 in February from January’s 56.2.
The employment index also improved to 56.6 in February from January's negative 43.6 reading.
But inflation remains high. The wholesale price index declined to 80.5 in February from 87.5 in January.
The monthly survey covers Arkansas, Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, Oklahoma and South Dakota.