Research >> Economics
Kansas City Fed Manufacturing Activity edged down in September
Tenth District manufacturing activity edged down in September, and expectations for future activity moderated but remained positive. The month-over-month price index for raw materials continued to fall, while the price index for finished products inched higher. Firms continued to expect prices to rise over the next 6 months, but at a slower pace.
Factory Activity Edged Down in September The month-over-month composite index was -2 in September, up slightly from -6 in August and similar to -1 in July. The composite index is an average of the production, new orders, employment, supplier delivery time, and raw materials inventory indexes. The dip in manufacturing activity was driven by continued declines at durable goods plants, especially from decreases in nonmetallic mineral products, primary metal, computer and electronic products, and transportation equipment manufacturing. While the month-over-month employment index dropped further in September, the production and shipments indexes rebounded considerably. Year-over-year factory indexes were somewhat mixed in September, but the composite index was unchanged at -1. The future composite index remained positive, but slowed from 9 to 5, the lowest future composite index since May 2016.
This month contacts were asked special questions about employment levels and capital spending plans compared with their expectations from early 2019. Nearly 34 percent of regional manufacturing contacts indicated that their number of expected employees for 2019 was higher since the beginning of the year, while 25 percent had lowered expectations for 2019 employment levels. Regarding capital spending, 30 percent of firms have delayed their plans in 2019, and 25 percent have delayed their capital spending plans for 2020. However, 18 percent of firms have accelerated their 2019 capital spending plans, and more than 11 percent have accelerated their capital spending plans for 2020.
Posted: September 26, 2019 Thursday 11:00 AM