The Federal Reserve Bank of Cleveland released its outlook for 2016. It finds: “(Reports) are best interpreted as mixed, fundamentals (like employment growth) for the broader District economy are good. So despite the weakening sentiment of District contacts’ reports and the cautious tone of the stock market, we continue to expect growth across the District in coming months.”
The bank researchers see three trends influencing the region’s economic growth:
The fall in energy prices has caused a significant slowdown in oil and gas exploration in the Marcellus and Utica Shales, though natural gas production remains at historic highs.
The rising value of the dollar and the weakness in oil and gas exploration have affected key District industries, including steelmaking. Steel producers are encountering difficulties even while domestic market users of District manufacturing products, namely construction and transportation equipment, are seeing growth.
Nationally and regionally, consumers are increasing purchases of durable goods, particularly automobiles, as their circumstances and balance sheets improve.