Research >> Economics
Kansas City Fed Manufacturing Activity steadied somewhat in October
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Tenth District manufacturing activity steadied somewhat, and expectations for future activity were largely flat following last month’s more negative reading. Most price indexes edged higher for the first time in several months.
The month-over-month composite index was -1 in October, up from -8 in September and -9 in August. The composite index is an average of the production, new orders, employment, supplier delivery time, and raw materials inventory indexes. Most of the improvement came from nondurable goods activity, with the exception of plastics products which continued to fall. Some durable goods also showed improvement in October, particularly machinery and primary metals, but other products such as fabricated metals, electronic equipment, and aircraft remained weak. The majority of other month-over-month indexes edged higher but still remained sluggish. The production index increased from 1 to 4, and the shipments, employment, and order backlog indexes also improved somewhat but stayed negative. The new orders index jumped from -8 to 7, its highest level in 10 months. The new orders for exports index fell further from -3 to -10, and both inventory indexes remained negative.
Year-over-year factory indexes edged up in October, but most stayed in negative territory. The composite year-over-year index improved from -13 to -7, and the production, shipments, new orders and employment indexes also moved slightly higher but remained negative. The capital expenditures index jumped from -3 to 13, while the new orders for exports index was basically unchanged. The raw materials inventory index edged up from -10 to -5, but the finished goods inventory index fell from -6 to -10.
Most future factory indexes rebounded after falling markedly last month. The future composite index moved up from -12 to -1, and the future production, shipments, and new orders indexes also increased. The future order backlog index jumped from -20 to -1, and the future employment index moved back into positive territory. The future new orders for exports index increased from -7 to 0, and both future inventory indexes also rose somewhat. In contrast, the future capital expenditures index fell from -1 to -9, its lowest level since July 2009.
Price indexes rose in October although some still remained at low levels. The month-over-month finished goods price index edged up from -7 to -3, and the raw materials price index also increased slightly. The year-over-year raw materials price index rose from 10 to 13, and the finished goods price index also moved higher. The future finished goods price index jumped from -5 to 8, and the future raw materials price index also increased.
Posted: October 22, 2015 Thursday 11:00 AM