Amarillo, TX - Amarillo National Bank has announced its economic predictions for 2016.
"Our economy has a lot of pillars and usually when one is down the other props itself up," said Executive Vice President William Ware. "This year we had a lot of legs of the stool broken and that's what made it tough."
Those tough times are here to stay because 2016's economy is predicated to stay at lower levels, Ware said.
One of the major economical impacts for the new year is commodity prices. In 2015, commodity prices dropped and are expected to stay low. They could also lead to weak job growth and flat or decreased wages.
However, oil and natural gas prices are expected to remain level. With gas prices lower it will keep inflation flat meaning there will be more disposable income in the pockets of consumers.
With the extra cash saved at the pumps and at grocery stores, Ware estimates retail sales will increase two percent.
The cattle market has been bad over the last three months. With fat cattle prices at $119, cattle farmers were hit hard, and the recent blizzard did not help. Many farmers lost thousands of cattle. Cattle prices will continue to dwindle over the next six to eight months as cows caught in the blizzard get healthy again and are able to be used in production, according to Executive Vice President Patrick Ware. However, because the cattle market is fluctuating frequently there is no prediction on cattle for the new year.
"The volatility in the market over the last three months has been so great we're not going to do any predictions on what's going to happen in 2016, although we think it's going to stay bad," Ware said.
However, he thinks there will be an upturn in the summer.
Real estate is estimated to remain steady, because many people refinanced in 2015 which created low mortgage rates.
Employment rates have shown little growth in 2015, but in lower paying jobs. The prediction for 2016 is that it will remain steady. There was a great decline in manufacturing and oil jobs, but construction and hospitality jobs should remain steady throughout the new year.
Overall, our economy is predicted to remain the same but the Wares hope to see growth through the building up of Downtown, tourism, and when cattle prices turn around.