Decision Analyst index slips

Arlington, Texas-based Decision Analyst, a market research firm, reported that its U.S. Economic Index fell from a reading of 101 in January 2013 to 99 in February 2013.

While the overall trend of the Economic Index has been upwards over the past 16 months, suggesting continued economic growth in the United States, the February downturn raises a red flag, especially on the heels of increased Social Security deductions and rising gasoline prices, plus the impact of sequestration, according to the firm. “February could just be a downward blip, or the start of a more serious downturn,” the company wrote. “It will take three or four additional months to know for sure.”

The West South Central Census Division records the highest Economic Index, with a score of 105. The East South Central Census Division has the lowest Economic Index at 95 (see map).

The Index numbers for the Census Divisions are three-month moving averages, to smooth out fluctuations due to smaller sample sizes. The reported Index number averages the current month with the previous two months.

“The U.S. economy could be poised for expansion in 2013, on the other hand, if the price of oil falls below $85 a barrel; if natural gas prices remain below $4 a thousand cubic feet; if Washington, D.C., can address and resolve major budget and spending issues; and if major corporations can climb out of their foxholes and start investing,” said Jerry Thomas, president/CEO of Decision Analyst. “Risks of economic contraction remain high, given all these ‘ifs’ and the developing recession in Europe.”