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Show Recession expected to continue this year The national economic recession is expected to continue into the fourth quarter according to Bill Gibson, vice president and manager of First Security Bank, Vernal, quoting from the "First Security Newsletter". The quarterly report, which will be published this week, is edited by Dr. Kelly Matthews, vice president and chief economist for . First Security Corporation, regional bank holding company. Following the imposition of credit controls by the Federal Reserve in March, consumer attitudes were sharply sharp-ly altered, reflected in an abrupt reduction reduc-tion in spending and credit demands. The degree of weakness in the economy is, however, anticipated to moderate relative to the free-fall experienced during the second quarter. According to the Newsletter, there is little chance that the national economy will re-establish a growth trend prior to 1981. Consumers are rebuilding savings and reducing debt burdens and are likely like-ly to increase borrowing and buying prior to achieving some gains in real income. in-come. Economic weakness in the second half of 1980 will be most evident in falling fall-ing production schedules and rising unemployment. Also, inflation at midyear mid-year was probably in the range of 10 percent which indicates that there is little lit-tle chance inflation will drop below 8 percent during the second half of 1980. The volatility in financial markets during the past six months was historically unprecedented, the publication states. Short-term interest rates, after rising to 18-20 percent, experienced ex-perienced a 2-month decline, while Treasury Bills and Certificates of Deposit were in the 74 to 8' 2 percent range by mid-year, up modestly from the lows established in May. Mortgage rates gradually edged downward and are presently in a range near 12 percent. per-cent. Leading Indicator Indexes for Utah dropped sharply in the second quarter and slower economic growth in Utah is expected in the third quarter. Although Utah's economy is influenced by a continuing con-tinuing national recession it has, in general, not been impacted by the recession to the extent experienced in other parts of the nation. During the second quarter, reduced rates of business activity in Utah spread from the construction and automobile industries to other manufacturing and retail segments of the economy. The rate of unemployment unemploy-ment in Utah is expected to edge toward 6 percent in the third quarter from the 5.3 percent which prevailed at mid year. Mining production in Utah during the first half of 1980 was below year-ago levels in most major minerals. Coal production cumulative through June was nearly 11 percent below last year. Additionally, copper production, down 2.5 percent through April, will be sharply sharp-ly lowered if the current strike is protracted, pro-tracted, forecasted the Newsletter. Residential construction in Utah is expected to remain very sluggish in the third quarter with building permits for new dwelling units currently down 52 percent below 1979 and total construction construc-tion value cumulative through May 1980, down 44 percent below last year. |