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Kansas City Fed Manufacturing Activity eased slightly in April 2022
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Growth in Tenth District manufacturing activity eased slightly, and expectations for future activity remained solid. The monthly index of raw materials prices inched upward in April and increased slightly compared to a year ago. Finished goods price indexes increased somewhat from a month ago but remained moderately higher than last year. Expectations for future raw materials and finished goods prices decreased further.
The month-over-month composite index was 25 in April, down from 37 in March and 29 in February. The composite index is an average of the production, new orders, employment, supplier delivery time, and raw materials inventory indexes. Increased activity was driven by growth in computer and electronic products, primary metals, and furniture manufacturing. On the other hand, the pace of growth for transportation equipment, electrical equipment, appliances, and food manufacturing declined. Month-over-month indexes remained positive, but the pace of growth eased somewhat compared to March. Indexes for production, shipments, new orders, backlog of orders, supplier delivery time, and finished goods inventories all decreased but remained positive. However, the employment index increased somewhat. Year-over-year index growth eased slightly, with a composite index of 54 in April. Shipments, capital expenditures, and employment indexes increased further from a year ago while supplier delivery time, order backlog, and finished goods inventory indexes eased slightly. The future composite index was 34 in April, a slight decrease from 41 in March. Indexes for future production, shipments, new orders, and employment all inched lower, while the future capital expenditures index was unchanged.
Special Questions
This month contacts were asked special questions on the change in number of job openings since the beginning of the year and the impact of COVID-induced lockdowns in China. In April, 48% of firms reported a slight increase in the number of job openings compared to the beginning of the year, and 19% reported a significant increase. As a result of the COVID-induced lockdown in China, 70% of firms reported higher supply chain disruptions and 57% reported higher input prices. A significant share of firms reported no change in demand, capital spending, hiring, and inventories. However, 17% of firms reported facing lower inventories due to the COVID-induced lockdown in China.
MANUFACTURING-APRIL-2022-KANSAS-CITY-FED.pdf
Posted: April 28, 2022 Thursday 11:00 AM