Research >> Economics
Kansas City Fed Manufacturing Activity expanded at a slightly faster pace in Nov
|
Tenth District manufacturing activity expanded at a slightly faster pace in November, and producers’ expectations for future activity increased further. Firms reported rising difficulties in attracting and retaining certain key workers, and several contacts cited increased labor costs. Price indexes were mixed with little change overall.
The month-over-month composite index was 7 in November, up from 4 in October and 6 in September. The composite index is an average of the production, new orders, employment, supplier delivery time, and raw materials inventory indexes. Producers of aircraft parts and equipment reported the strongest growth, while contacts at plastics and chemical plants reported a decline in activity. Most other month-over-month indexes were also higher than last month.
The production index rose from 3 to 9, and the shipments, employment, and new orders for exports indexes also increased. The order backlog index moved into positive territory for the first time in four months, while the new orders index was basically unchanged. The finished goods inventory index jumped from -5 to 4, and the raw materials inventory index increased for the second straight month.
Most year-over-year factory indexes moderated somewhat. The composite year-over-year index fell from 17 to 9, and the production, shipments, and new orders indexes also moved lower. The employment index decreased from 16 to 10, and the capital expenditures index edged down after rising last month. In contrast, the order backlog index improved from 6 to 10, and the new orders for exports index moved into positive territory. Both inventory indexes fell further.
Future factory indexes strengthened further in November. The future composite index moved higher from 17 to 22, and the future production, shipments, and order backlog indexes also rose. The future employment index jumped from 16 to 31, its highest level in almost nine years. In contrast, the future new orders index eased from 26 to 24, and the future capital expenditures index also edged lower. The future finished goods inventory index decreased from 12 to 9, while the future raw materials inventory index was basically unchanged.
Price indexes were mixed with little change overall. The month-over-month raw materials price index decreased from 17 to 12, while the finished goods price index increased slightly. The year-over-year raw materials price index inched higher from 44 to 46, while the finished goods price index was basically unchanged. The future raw materials price index eased from 38 to 33, while the future finished goods price index ticked up somewhat, indicating more firms plan to pass recent cost increases through to customers.
Posted: November 21, 2014 Friday 11:00 AM