OCR Text |
Show Utah Outlook i Good Despite ! Lock Of Water Utah's economic outlook remains strong despite a severe water shortage across the state, according to the quarterly First Security Bank Newsletter released this j week, said Richard Parkin- ! son, manager of First ' Security Bank of Bountiful. Dr. Kelly K. Matthews, vice president and economist, is i editor of the newsletter. j MOST SECTORS of the state economy experienced significant progress in the first quarter of 1977, the i newsletter says. Positively ! influenced by a stronger na-! na-! tional economy, the Utah economy is expected to main-1 main-1 tain this upward momentum during the next three months. While the rate of unemployment in Utah is expected ex-pected to remain near 5.5 per cent, job creation in the con- struction, manufacturing and mining industries is expected to increase. RAPID expansion is : predicted in the construction ': industry during the second : quarter, reflecting the sizable : increase in both residential " and non-residential building ; permits issued in the first : quarter. The improvement in the . national economy will favorably favora-bly influence copper and steel : production, and an accelera-tion accelera-tion in mining activity should increase coal production in Utah after a slow first quarter. THE newsletter further predicts that retail sales will . continue to grow at the 14 per cent rate recorded in the first three months of 1977. The i continuation of the drought in the Western States could i. reduce consumer confidence. 5 However, during the first quarter, consumer spending and credit demands con- ; tmued strong, indicating that uncertainty associated with the drought has not yet had a negative effect. On the national scene, the letter predicts that business activity will accelerate sharply, establishing an above-average growth pattern that will probably continue throughout the summer. THE RATE of inflation should reach above 6 per cent during 1977, despite the Carter Administration's announced an-nounced anti-inflationary policy. The rate of real economic expansion in the April-to-June period will reach an annual rate of 7-8 per cent. Interest rates will remain relatively stable during the second quarter, but higher inflation and rising demands for credit will push interest rates upward in the second half of 1977. BUSINESS spending for plant and equipment is also anticipated to increase in the next quarter. Of President Carter's decision to drop his request for a $50 tax rebate, the newsletter concluded that the urgency to stimulate the economy, which led to the rebate proposal, no longer exists. |