The U.S. Economy Ending The Year Signals Growth, According To Decision Analyst’s Economic Index
Arlington, Texas—The Decision Analyst U.S. Economic Index was 112 in November 2016, a 4-point increase from November 2015. This increase in the Economic Index signals continued U.S. economic growth for the first half of 2017. The Economic Index tends to lead U.S. economic activity by 6 to 12 months. Below is the past-10-year history of the U.S. Economic Index.
“The overall trend of the U.S. Economic Index over the past year suggests that 2017 will likely show an improved rate of economic growth over 2016,” said Jerry W. Thomas, President/CEO of Decision Analyst. “The election of Donald Trump as the next president does not appear to be affecting public attitudes toward the U.S. economy thus far, either positively or negatively. Nevertheless, the change of political leadership and power carries with it risks of economic turmoil. Disruptions in the flow of imports and exports could have major negative effects on the U.S. economy if the Trump team pursues trading restrictions. The U.S. economy also faces headwinds from slow growth among some of its major trading partners, such as the European Union, Japan, and China. The failure of large U.S. corporations to adequately invest in new equipment, new products, new people, and new facilities is a drag on the U.S. economy. We continue to believe that higher rates of interest would be good for the economy long-term,” said Thomas. “More normal interest rates would help reduce corporate financial engineering and would reduce speculative investments in marginal opportunities.”
The U.S. Census Divisions have increased in the past 12 months, except for the New England Census Division. The South Atlantic had the highest score of all the Census Divisions. It registered an Index score of 113 for November 2016; that is an increase of 4 points from November 2015. The New England Census Division had the lowest Index score, a 108 for November 2016; that is a decrease of 1 point from November 2015.
The following chart compares Decision Analyst’s U.S. Economic Index to the Economic Indices for other countries. South America is in trouble. Colombia has declined by 7 points in the past 12 months, and Argentina has declined by 5 points. There are glimmers of hope in Europe. France has increased 8 points in the past 12 months, while the Russian Federation has increased 7 points. However, Germany has declined 5 points in the past 12 months.
The Decision Analyst Economic Index is based on a monthly online survey of several thousand households balanced by gender, age, and geography. The scientific survey is conducted in the last 10 days of each month. The Economic Index is calculated from 9 different economic measurements using a sophisticated econometric model. The result is a snapshot of coming economic activity in each country surveyed, as seen through the eyes of representative consumers living in the respective countries.
Decision Analyst conducts its concurrent economic surveys each month in Argentina, Australia, Brazil, Canada, Chile, Colombia, France, Germany, India, Italy, Mexico, Peru, the Russian Federation, Spain, United Kingdom, and the United States. Whenever the Decision Analyst Economic Index is greater than 110, it tends to signal an expanding economy. An Index value of 90 to 110 suggests a no-growth or slow-growth economy, and near or below 90 generally indicates economic contraction. These guidelines vary by country, however.
About Decision Analyst
Decision Analyst (www.decisionanalyst.com) is a global marketing research and analytical consulting firm specializing in strategy research, new product development, advertising testing, and advanced modeling for marketing decision optimization. For over 35 years, the firm has delivered competitive advantage to clients throughout the world in consumer-packaged goods, telecommunications, retail, technology, medical, and automotive industries.
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