ST. LOUIS—A February survey of business contacts in the St. Louis Zone of the Federal Reserve Bank of St. Louis revealed continued optimism about the outlook for local economic conditions in 2015. In fact, only one in 10 respondents expects conditions to worsen in 2015.
The information was published March 24 in the latest quarterly release of the Burgundy Books, a publication produced by the St. Louis Fed. The reports offer comprehensive economic information for each of the bank’s four zones: St. Louis, Little Rock, Ark., Louisville, Ky., and Memphis, Tenn.
The St. Louis Zone represents a total population of approximately 5.6 million people, including close to 3 million who live in the St. Louis metropolitan statistical area (MSA).
Nonfarm employment in the St. Louis MSA increased 0.9 percent in the fourth quarter of 2014. Employment growth was modestly stronger in the Springfield, Mo., MSA but weaker in the Zone’s three remaining MSAs. Growth of transportation employment was especially brisk in Missouri and Illinois.
The St. Louis Zone’s average unemployment rate fell by nearly 0.75 percentage points to 5.6 percent in the fourth quarter of 2014. Unemployment rates were below 5 percent in the Columbia, Mo., (4.0 percent), Jefferson City, Mo., (4.8 percent) and Springfield, Mo., (4.6 percent) MSAs. Business contacts appear upbeat about the outlook for labor market conditions.
After a weak first half of 2014, new and existing home sales in the St. Louis MSA showed signs of stabilizing in the second half of 2014. Still, sales in 2014 were 2 percent below those in 2013.
Several automotive dealers reported that falling gasoline prices have spurred an upsurge in sales of trucks and sport utility vehicles. However, automotive loan delinquency rates rose significantly during the fourth quarter of 2014.
Reports from the Zone’s banking contacts suggest a modest pickup in loan demand, fueled in part by increased competition.
A majority of agricultural bankers surveyed in late 2014 expect farm income, farmland values and capital expenditures to decline in the first quarter of 2015 compared with the previous year.
View the entire St. Louis report at http://research.stlouisfed.org/regecon/burgundybooks/15/03/BB0315StL.pdf.
The next Burgundy Books will be released June 23, 2015.