State economic index in slow downward edge

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Timothy A. Duy
Director, Oregon Economic Forum
Department of Economics, University of Oregon

The Oregon Measure of Economic Activity fell to 0.63 in September from an upwardly revised July reading of 0.70. Highlights of this month’s report include:

Building permits continued to decline on the back of softer construction of multifamily units; stagnant to falling rents, particularly in the Portland region, combined with higher interest rates and construction costs to slow activity.
The household sector continues to make a positive contribution, supported by a strong labor market and high levels of consumer confidence.
The moving average measure, which smooths out the volatility, stood at 0.70, well above average (“zero” indicates average growth over the 1990-present period).
The manufacturing sector made a neutral contribution; hours worked remains a persistently weak component and may reflect new work-week limitations for Oregon manufacturing firms rather than a shift in Oregon’s economy.
The University of Oregon Index of Economic Indicators edged down slightly in September. Most indicators made only modest changes during the month.

The decline in the UO Index in recent months is not sufficient to raise recession concerns. Together, these indicators still suggest ongoing growth in Oregon at an above average pace of activity.