The first quarter of the year produced largely positive signals from the state economy. Nonfarm employment advanced, manufacturing jobs expanded, nominal personal income growth accelerated and taxable sales continued their ascent. One piece of bad news was a rise in the first quarter unemployment rate from the fourth quarter of 2010. The good showing from the state, along with decent underlying strength for the national economy, should allow the Tennessee economy to enjoy a period of modest economic expansion into 2013.