R.I. business confidence rises
from previous year in Q3

CITIZENS BANK predicts steady activity and a seller's market in its 2020 Mergers & Acquisitions Outlook. / BLOOMBERG NEWS FILE PHOTO/SCOTT EISEN
CITIZENS BANK predicts steady activity and a seller's market in its 2020 Mergers & Acquisitions Outlook. / BLOOMBERG NEWS FILE PHOTO/SCOTT EISEN

PROVIDENCE – Business confidence in the third quarter of 2019 in Rhode Island has improved from one year prior, according to Citizens Bank.

The Rhode Island Business Conditions Index measures Rhode Island employment, wage growth, national manufacturing performance and local Citizens client revenue. The Rhode Island value in the third quarter was 61.2, an increase from 60.5 in the third quarter of 2018.

“Rhode Island business leaders are optimistic as they close out 2019 and head into 2020,” said Keith Kelly, Citizens Bank Rhode Island president. “They will remain cautious until there is more clarity on a trade agreement, but despite a lot of talk about the economic expansion coming to an end, the fundamentals of the U.S. economy remain strong. If there is a downturn on the horizon, it will likely be a small correction. Next year may be polarizing due to the election, but we hope to see continued consumer confidence, which should drive economic growth.”

Kelly said the medical profession, hospitals and higher education boosted the economy and “provide a solid foundation of employment and growth” in the state.

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However, he noted the state is not without some economic uneasiness.

“Rhode Island business leaders are concerned about a host of unknowns,” he said. “There are several local issues that are creating distractions such as the state taking control of the Providence school district and then there are national and international issues that are impacting businesses such as the ongoing trade war with China coupled with the escalating tariffs.

“There is also growing uncertainty because of the 2020 election. Companies are holding back due to uncertainty and they are not making capital investments in some cases until there’s more market clarity.”

Nationally, the business conditions index declined from 61.2 to 60.2 year over year in the third quarter.

A value over 50 indicates an expansionary trend and points to improved business growth for the next quarter, according to Citizens.

“The U.S. economy continues to show its resiliency, powered by consumers who continue to ignore the increasing geopolitical noise as they head into the traditional holiday shopping season,” said Tony Bedikian, head of global markets for Citizens Commercial Banking. “The slight dip in the index seems to have been caused by continued trade uncertainty, but even that was not enough to make much of a dent in the indicators overall. While there seems to be growing concern about next year, it also seems as if economists have been saying that every year for at least the last several years.”

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