Utah's economy strengthened a bit in February, according to a monthly survey of the state's purchasing managers.
The February purchasing index compiled by Creighton University economics professor Ernie Goss moved up from 55.5 in January to 56.2 last month.
"Some sectors of the Utah economy report improved economic prospects as a result of higher energy prices," said Goss, who surveys Utah, Colorado and Wyoming using the same criteria as the National Association of Purchasing Managers (NAPM), a leading economic indicator since the monthly survey was launched in 1931.
"Utah's February readings of 50.0 for new orders, of 65.8 for production and 60.5 for employment all indicate relative strength in the coming months," Goss said.
The purchasing index ranges between 0 and 100, with an index higher than 50.0 suggesting that sector is expanding, while a lower number indicates a slowdown.
The overall Mountain States index was at 54.5 for February, up 1.2 points from January. The prices paid index, a gauge of inflation, shot up to 71.1 from January's already high 69.7 as prices that purchasers had to pay for raw materials continued moving up.
Colorado's overall index of 47.4 indicated somewhat weaker conditions in that state, but Wyoming's economic conditions remained robust at 62.5, down 1.4 points from the previous month. As in Utah, Goss cited rising energy prices for
Wyoming's relatively strong economy.
"Certain sectors in the Mountain States region have benefited from higher energy prices over the past several months," Goss said. "Additionally, exports from the three-state region have held up better than exports from other parts of the United States."
But given the weakness in other consumer surveys, Goss said he expects the Federal Reserve to move "very soon" to once again lower interest rates, despite the possibility that such action will boost inflation. However, Fed Chairman Alan Greenspan indicated this week that the Fed is unlikely to do anything with interest rates until its next regularly scheduled meeting on March 20.
Nationwide, the NAPM said Thursday that its manufacturing index fell for the seventh month in a row in February to 41.9, more than meeting the accepted definition of a recession, which is six consecutive months of contraction.
And it was the second straight month in which the index, which represents 20 percent of the national economy, was below 42.7. The NAPM considers a manufacturing index below 50 as a sign of contraction and below 42.7 a signal that the entire national economy is receding.
The only bright spot was in the autos sector, where increased sales suggested that the economy might not be as lame as many economists have feared and that the so-called "soft landing" from the boom times of the late 1990s may be a reality.
But Goss is not buying that scenario.
"Surveys over the past several months have convinced me that without aggressive action on the part of the Federal Reserve (to lower interest rates) there is the real possibility of an economic recession."
For more information on the national purchasing report, go to (www.napm.org).