After 29 Months of Economic Expension Needle Moving Neutral

HOUSTON (Houston Chronicle) – January 15, 2019– A near-term forecast indicates continued overall economic growth in Houston but warns that manufacturing growth may slow over coming months.

The Houston Purchasing Manager’s Index reported that manufacturing activity in Houston expanded in December for the 15th consecutive month, and overall economic activity expanded for the 29th month.

The index registered at 53.3, down from 54.9 in November. Readings over 50 generally indicate expansion; readings below 50 show contraction.

The index’s readings for Houston’s employment and lead times, two of three underlying indicators tied to economic activity, showed continued strength. ​

The third indicator—the sales and new orders index—fell below neutral for the first time in 13 months.

The three-month forecast for the Houston index registered 49.8, down 3.3 points from its November reading of 53.1.

Weakening sales/new orders, production, and lead times, which are all directly tied to economic activity, were the primary drivers for the fall.

The institute projected continued strength during the next three months for health care and construction but expects manufacturing and wholesale trade to weaken.