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Kansas City Fed Manufacturing Activity expanded just slightly in February
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Tenth District manufacturing activity expanded just slightly in February, but producers expected activity to pick up moderately in the months ahead. Most price indexes continued to decrease, with several reaching their lowest level since 2009.
The month-over-month composite index was 1 in February, down from 3 in January and 8 in December. The composite index is an average of the production, new orders, employment, supplier delivery time, and raw materials inventory indexes. The overall slower growth was mostly attributable to large declines in primary metals and computer and electronics production. Looking across District states, the weakest activity was in Colorado, Oklahoma, and New Mexico. In contrast, production activity in the fabricated metals and machinery industries both increased moderately. Other month-over-month indexes were mixed. The production and shipments indexes both moved back into positive territory. In contrast, the new orders index continued to decline, and the employment index decreased from 0 to -4. The finished goods inventory index eased from 8 to 3, and the raw materials inventory index also fell.
Year-over-year factory indexes were also somewhat mixed. The composite year-over-year index remained unchanged at 9, while the production, shipments, and order backlog indexes were higher than last month. The capital expenditures index edged up from 7 to 9, while both inventory indexes were basically unchanged. On the other hand, the new orders index inched lower from 5 to 3, and the employment index fell for the second straight month.
Future factory indexes eased slightly but remained at mostly solid levels. The future composite index moved down from 19 to 11, and the future production, shipments, and new orders index also decreased moderately. The future employment index dropped from 24 to 14, its lowest level in 5 months, and the future capital expenditures index edged down. The future finished goods inventory index fell from 18 to 7, and the future raw materials inventory index also decreased slightly.
Most price indexes continued to decrease in February. The month-over-month finished goods price index remained unchanged at -3, and the raw materials price index dropped from 8 to -6, its lowest level since May 2009. The year-over-year raw materials price index fell from 39 to 29, and the finished goods price index eased slightly. The future raw materials price index moderated from 31 to 25, and the future finished goods price index plummeted from 27 to 6, a five-year low.
Posted: February 26, 2015 Thursday 11:00 AM