January Institute for Supply Management Research survey: West Michigan economy remains soft
The West Michigan economy remains soft. That’s the finding from the January Institute for Supply Management Research survey. There’s a tariff hangover and the coronavirus outbreak hindering the global economy.
The signing of the United States – Mexico – Canada Trade Agreement will benefit Michigan businesses. Gone are the tariffs.
“There was a pretty stiff penalty that Canada had put on our auto parts going to Canada and most of that will be taken away.”
Brian G. Long, director of Supply Management Research in the Seidman College of Business at Grand Valley State University explains auto and office furniture sales are moderating, but it’s “not a cause for worry.”
China is where Long is keeping watch. The signing of the Phase 1 China Trade Deal has relaxed some of the tariffs.
“According to the agreement with China, they are going to purchase a lot more of our farm commodities. Particularly, pork, and to a lesser degree beef, but also our soy beans. This is going to be a positive factor as far as all the farmers in Michigan are concerned.”
It’s the coronavirus outbreak that is leaving purchasing managers from West and Southwest Michigan uneasy.
“The coronavirus, is of course, impacting the world market right now because China has locked down a lot of their production capability. And their GDP is falling, and what’s even worse, is shipments are being delayed.”
How that plays out to be seen in upcoming surveys.
And while industrial inflation is rising, Long adds, “That’s a fairly clear indication that we are not sliding into a recession anytime soon.”
Patrick Center, WGVU News.