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Kansas City Fed Manufacturing Activity declined at a slightly slower pace in June
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Tenth District manufacturing activity declined at a slightly slower pace than the previous month, and producers’ expectations improved modestly. Most price indexes continued to rise, particularly for raw materials.
The month-over-month composite index was -9 in June, up from -13 in May but down from -7 in April. The composite index is an average of the production, new orders, employment, supplier delivery time, and raw materials inventory indexes. Durable goods manufacturing improved slightly, although still negative, particularly for aircraft products and parts. However, nondurable goods production fell further broadly across all types of plants. Production fell in all District states except for Colorado, but continued to be most negative in energy-concentrated Oklahoma. The majority of other month-over-month indexes also remained negative. The production index contracted further from -13 to -21, its lowest level since February 2009, and the shipments index also decreased. On the other hand, although still negative, the new orders, order backlog, employment, and new orders for export indexes edged higher. The finished goods inventory index fell from 0 to -6, while the raw materials inventory index was basically unchanged.
Year-over-year factory indexes decreased from the previous month. The composite year-over-year index eased from -5 to -9, and the production, shipments, new orders, and order backlog indexes all fell to their lowest levels since late 2009. The employment index fell back into negative territory after increasing last month, and the capital expenditures index inched lower while remaining positive. Both inventory indexes decreased from the previous month.
Most future factory indexes improved slightly in June. The future composite index edged up from 0 to 3, and the future production, new orders, and order backlog indexes also showed positive gains. The future capital expenditures index jumped from 0 to 13, its highest level in 5 months. In contrast, the future employment index decreased from 7 to 0, and the future shipments index also eased somewhat. The future finished goods inventory index fell from -5 to -11, while the future raw materials inventory index was basically unchanged.
Most price indexes continued to rise in June, although monthly selling prices were still negative. The month-over-month finished goods price index inched higher from -4 to -2, and the raw materials price index jumped from -6 to 13. The year-over-year raw materials price index increased from 6 to 27, and the finished goods price index edged up slightly. The future raw materials price index rose from 19 to 33, while the future finished goods price index was basically unchanged.
Posted: June 25, 2015 Thursday 11:00 AM