BISMARK, N.D. (AP) - A North Dakota economist expects the projected economic recession to be both good and bad news for the state’s next two-year budget cycle.
The fiscal forecast anticipates strong expectations in 2019 followed by a slower pace of growth similar to the rate of inflation for 2020 and 2021, The Bismarck Tribune reported .
Dan White, Finance Director of Moody’s Analytics, said a national recession expected to occur by 2020 would cause the demand for oil and agriculture to decrease.
White believes that North Dakota would benefit from a weaker U.S. labor market because more workers would seek opportunities in the state. He added that economists believe the recession will be relatively mild.
“We are not predicting the next Great Recession,” White said. “We do not see a huge imbalance anywhere in the credit markets.”
The budget forecast notes that the U.S. and China “trade drama” further complicates the state’s agricultural outlook, with North Dakota relying on agricultural trade with China for soybeans.
The forecast presumes the U.S. will have a “reasonably graceful solution” to the trade war before the 2020 election cycle.
The report highlights that any escalation or extension of the trade war could lead to farmers having a more difficult time than projected in the forecast.
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Information from: Bismarck Tribune, http://www.bismarcktribune.com
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