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Kansas City Fed Manufacturing Activity remained negative in March
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Tenth District manufacturing activity remained negative, while producers’ expectations for future activity weakened. Most price indexes edged higher in March, but remained at low levels.
The month-over-month composite index was -6 in March, up from -12 in February and -9 in January . The composite index is an average of the production, new orders, employment, supplier delivery time, and raw materials inventory indexes. The improvement in the index came from both durable and nondurable goods factories, particularly for chemicals, machinery, and nonmetallic mineral production. Activity remained weak in most District states. Most month-over-month indexes rose somewhat from the previous month.
The new orders, order backlog, and employment indexes improved slightly but remained in negative territory. In contrast, the production index dropped from -8 to -14, and the shipments and new orders for exports indexes also fell. The raw materials inventory jumped from -16 to -2, and the finished goods inventory index also moved higher.
Year-over-year factory indexes were mixed but generally remained weak. The composite year-over-year index inched higher from -20 to -18, and the new orders, order backlog, and employment indexes also showed slight improvements. The production and shipments indexes decreased further, while the new orders for exports index remained unchanged at -13. The capital expenditures index declined from -10 to -19, its lowest level since December 2009. Both inventory indexes moved slightly higher.
Most future factory indexes eased somewhat in March. The future composite index edged down from 4 to -2, falling into negative territory for the first time in six months. The future production, shipments, new orders, and order backlog indexes all fell slightly but remained positive. The future employment index eased from 3 to 1, while the future capital expenditures index was unchanged at -9. The future raw materials inventory index decreased from -10 to -13, while the future finished goods inventory index moved higher.
Price indexes generally edged up in March but remained at low levels. The month-over-month finished goods price index moved up from -17 to -10, while the raw materials price index was basically unchanged. The year-over-year finished goods price index rose from -10 to -4, and the raw materials price index also increased. The future finished goods price index increased slightly from -2 to 1, while the future raw materials price index was basically unchanged.
Posted: March 24, 2016 Thursday 11:00 AM