The Inland Empire economy showed some positive signs during February, according to the monthly report prepared by the Institute of Applied Research at Cal State San Bernardino.
“This month’s Inland Empire Purchasing Managers’ Index (PMI) increased to 58.6 from last month’s 56.8. The good news is that this is the second month above the 50 percent benchmark, showing growth in the manufacturing sector as well as the general Inland Empire economy," said Dr. Barbara Sirotnik and Lori Aldana, authors of the report.
All of the major components of the PMI registered above 50, with only minor changes from the previous month's figures, the authors said.
"Production decreased ever so slightly from last month’s 67.7 to 67.2 this month. New Orders registered an increase from 61.3 to 63.8. The Employment Index was virtually unchanged, growing only slightly from 53.2 to 53.4," the report said.
"The Supplier Deliveries Index also showed only a slight change from last month’s 53.2 to 53.4 this month. The fact that the figure remained above 50 reflects the fact that the speed of delivery is slowing a bit (a sign that suppliers are busy and can’t keep up with demand as well as the month before)."
The Inventory Index had a large increase this month from 48.4 to 55.2, and the Commodity Prices Index decreased slightly from 61.3 last month to 60.3 this month, indicating that inflationary pressures continue in the Inland Empire, but at a slightly reduced pace, the authors said.
"In summary, in last month’s report we noted that the low PMI figures in the last quarter of 2016 may have been a cyclical decrease, and we projected that this month’s PMI would continue to show growth. That is exactly what the figures showed," the authors said.
"Further, recent press articles note that Inland Empire construction is up in the Inland Empire, small businesses are bullish on their prospects for the coming quarter, and the real estate market is heating up. Thus we project that the Inland Empire economy will hold its own for at least the coming quarter. But it is difficult to project past that point. A lot depends on what happens on the national scene relative to changes in policies regarding health care, global logistics, and trade policies."