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Economy continues to climb.

Byline: Sherri Buri McDonald The Register-Guard

Economic activity in Oregon strengthened a bit in May, continuing the upward trend of the past eight months, according to the University of Oregon's latest Index of Economic Indicators.

Activity is expected to pick up speed in the second half of the year and into 2014, said UO economist Tim Duy, the author of the index.

"The idea is that the first half of the year is being weighed down by higher taxes and less government spending," he said.

"One argument (is) we've done pretty well despite that," Duy said. "Growth numbers for the first half are weaker than we'd expect; job numbers are holding up. There's a sign buried in there that the private sector is doing reasonably well despite the fiscal contraction."

The UO index gives an outlook for the state's economy in the coming three to six months. It tracks eight economic indicators, including initial unemployment claims, residential building permits and orders for capital goods.

The index rose to 96.2 in May, up from 95.5 in April. The index uses 1997 as the base year of 100. In general, the higher the index, the rosier the economic outlook.

All eight indicators have improved during the past six months, Duy said.

Initial unemployment claims filed in Oregon increased slightly from April to May, but the level is still consistent with overall job growth, he said.

Employment services payrolls, mostly temporary employees, rose from April to May. Residential building permits continue to rise and are now at their highest level since December 2007. Core manufacturing orders, which does not include defense or aircraft, are up, and so is the Oregon weight-distance tax, a measure of trucking activity.

In addition to watching the impact of higher taxes and lower government spending, Duy said he has his eye on mortgage rates and global trade.

"The risks of some softer numbers would come either from rise of mortgage rates perhaps taking some steam out of the housing market (or) we see relatively slow global trade that may take some steam out of exporters," he said.

"I think the dominant factor will be the domestic economy and the fiscal issues, but those two things are on my horizon as issues I'm watching," Duy said.
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Title Annotation:Business; All indicators point up in the UO's monthly index, with activity expected to accelerate later in the year
Publication:The Register-Guard (Eugene, OR)
Geographic Code:1U9OR
Date:Jul 11, 2013
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