The national economy is forecast to grow at an annual rate of approximately 2.0% to 2.5% during the second half of 1986. Expansionary monetary policy, a lower dollar, declining interest rates, and falling energy prices have not had, nor are forecast to have, a large stimulative effect on output and employment for the rest of the year. Usually, the aforementioned variables will provide more of a stimulus than has transpired. Moreover, the possibility of over stimulation seems remote. Given the slack that exists in the national and world economy, it seems unlikely that in the short-term inflation will be much of a problem.

     The Central Wisconsin regional economy, given the positive variables previously cited, should experience a modest amount of economic expansion. Also, tourism which has increased domestically due to lower gasoline prices and international terrorism should add stimulus to the local economy. However, the farm situation will continue to be a drag on the regional economy. Ripple effects from the farm situation will filter through the system and dampen future activity.