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Kansas City Fed Manufacturing Activity grew more modestly in April
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Tenth District manufacturing activity grew more modestly in April, and expectations for future activity eased slightly but remained mostly solid (Chart 1). Price indexes showed little change, with some slight upticks in month-over-month selling prices and future raw materials prices.
Factories Report Accelerated Activity in April The month-over-month composite index was 5 in April, down slightly from 10 in March but higher than 1 in February. The composite index is an average of the production, new orders, employment, supplier delivery time, and raw materials inventory indexes. Growth eased slightly in factory production of both durable and nondurable goods, particularly food, machinery, electronic, and chemical products. Most month-over-month indexes slowed in April but remained positive, with production, shipments, order backlog, and employment all decreasing. In contrast, the new orders index edged higher from 4 to 10. Most year-over-year factory indexes fell in April, and the composite index eased from 27 to 22. The future composite index also moved lower from 22 to 11, as most future factory activity indexes eased somewhat.
Special Questions This month, contacts were asked special questions about impacts from recent flooding or extreme weather. About 33 percent of manufacturing contacts indicated they have had some negative effects from weather, mostly due to delayed shipments, power outages, and staffing challenges. Firms were also asked if recent increases in interest rates had affected their capital spending plans. Over 87 percent of firms said their spending plans were unchanged, with approximately 9 percent noting some decreases in expenditures as a result of higher rates, while 4 percent of firms indicated an increase in capital spending due to elevated rates.
Posted: April 25, 2019 Thursday 11:00 AM