The Texas economy experienced another downshift in growth over the last two months, although the level of activity remains strong. Job growth decelerated slightly in the fourth quarter, and the Dallas Fed’s Texas Business Outlook Surveys (TBOS) suggest a slowing in output growth in December and January.
Expectations have also slumped; the 2019 job growth forecast for Texas is now between 1 and 2 percent, and survey contacts’ outlooks have notably deteriorated since November. Headwinds include lower oil prices, a strong dollar, tariffs, higher interest rates, labor constraints and increased uncertainty. Wage and price inflation may also be moderating; survey data point to softer growth in the second half of 2018 and expectations for slower growth in 2019.
Texas Economic Update February 1, 2019 via dallasfed.org