By CBJ News Staff
The Iowa Leading Indicators Index (ILII), used by state officials to forecast tax revenues, decreased 0.3% to 100.5 in June from 100.8 in May. This is the seventh month in a row of decreases. However, this impact is considerably less than that experienced in March and April.
With only two of the eight components contributing positively, the monthly diffusion index remained unchanged at 18.8 in June as COVID-19 continues to affect the Iowa economy along with the U.S. as a whole.
The Iowa non-farm employment coincident index recorded a 0.64% decline in June, the seventh month in a row of decline and the third largest one month decline in the 20-year history behind only April and May 2020. The six-month diffusion index decreased to 25.0 from 37.5 in May, the annualized six-month ILII change value of -11.9% and the decline in the Iowa non-farm employment coincident index strongly suggest the Iowa economy will continue to weaken into first quarter FY 2021. This report suggests that employment growth will weaken over the next three to six months.
Only two of the eight components added to the ILII in June, the Iowa stock market index and the national yield spread. In June, the Iowa stock market index experienced gains in 30 of the 31 companies including 10 of the 11 financial companies. With nearly all of the stocks experiencing gains, the index increased to 77.51 in June from 70.28 in May. Wells Fargo Corporation, John Deere and Company, Tyson, Corteva, and ConAgra contributed the most gains to the index.
The monthly Iowa Leading Indicators Index report is available on the department’s website. CBJ