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Kansas City Fed Manufacturing Activity continued to decline modestly in April
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Tenth District manufacturing activity continued to decline modestly, while producers’ expectations for future activity improved considerably. Most price indexes moved slightly higher in April, but remained at low levels.
The month-over-month composite index was -4 in April, up from -6 in March and -12 in February. The composite index is an average of the production, new orders, employment, supplier delivery time, and raw materials inventory indexes. The slight improvement in the index came from a rise in nondurable goods production, particularly for food, paper, and plastics products. Durable goods production such as metals and machinery remained negative. Most month-over-month indexes rose somewhat from the previous month. The production, shipments, and new orders for exports indexes improved slightly but remained in negative territory. In contrast, the new orders and employment indexes were negative but unchanged and the order backlog index fell from -15 to -18. The raw materials inventory edged up from -2 to 0, while the finished goods inventory index fell.
Year-over-year factory indexes were mixed, but generally remained weak. The composite year-over-year index was basically unchanged at -19, while the production and shipments indexes showed slight improvements. The new orders, order backlog, and employment indexes all fell further into negative territory. The capital expenditures index was basically unchanged at its lowest level since December 2009. Both inventory indexes declined after rebounding last month.
Most future factory indexes improved markedly in April. The future composite index jumped from -2 to 10, its highest level in over a year, and the future production, shipments, and new orders indexes also rebounded strongly. The future order backlog index rose from -10 to -1, and the future employment index posted its highest level in five months. The future capital expenditures index inched higher from -9 to -6, and the future new orders for exports index moved into positive territory. The future raw materials inventory index increased from -13 to -5, while the future finished goods inventory index moved slightly lower.
Price indexes edged higher in April but remained at low levels. The month-over-month finished goods price index moved up from -10 to -6, and the raw materials price index jumped from -10 to 4. The year-over-year finished goods price index rose from -4 to -1, while the raw materials price index was unchanged. The future finished goods price index increased slightly from 1 to 2, and the future raw materials price index also rose modestly.
Posted: April 28, 2016 Thursday 11:00 AM