Of the five Federal Reserve districts which have released their July manufacturing surveys, all are forecasting growth. A complete summary follows. [note that values above zero represent expansion].
Texas factory activity increased again in July, according to business executives responding to the Texas Manufacturing Outlook Survey. The production index, a key measure of state manufacturing conditions, rose from 15.5 to 19.1, indicating output grew at a faster pace than in June.
Other measures of current manufacturing activity reflected significantly stronger growth in July. The new orders index doubled from 6.5 to 13. The capacity utilization index also posted a strong rise, moving to 18 from 9.2 in June. The shipments index rose 12 points to 22.8, reaching its highest level since January 2013. The July readings for these indexes were all more than twice their 10-year averages, suggesting notably robust manufacturing growth.
Perceptions of broader business conditions were more optimistic this month. The general business activity index edged up from 11.4 to 12.7, pushing to its highest level in 10 months. The company outlook index rose 3 points to 11.3.
Labor market indicators reflected continued employment growth and longer workweeks. The July employment index posted a second robust reading, although it edged down from 13.1 to 11.4. Twenty-five percent of firms reported net hiring compared with 14 percent reporting net layoffs. The hours worked index edged up from 4.7 to 6.3, indicating a slightly stronger rise in hours worked than last month.
Upward pressure on prices and wages continued at about the same pace in July as in June. The raw materials price index came in at 25.4, less than a two-point change from the 27.3 June reading. The finished goods price index held steady at 7.3, and the wages and benefits index remained at 18.8. All three July index readings were very close to their 10-year averages.
Expectations regarding future business conditions remained optimistic in July. The index of future general business activity inched up to 19.8, while the index of future company outlook fell to 24.4 after reaching a multiyear high of 33.8 in June. Indexes for future manufacturing activity showed mixed movements in July but remained in solidly positive territory.
Source: Dallas Fed
Summary of all Federal Reserve Districts Manufacturing:
Richmond Fed (hyperlink to reports):
Kansas Fed (hyperlink to reports):
Dallas Fed (hyperlink to reports):
Philly Fed (hyperlink to reports):
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New York Fed (hyperlink to reports):
Federal Reserve Industrial Production - Actual Data (hyperlink to report)
Holding this and other survey's Econintersect follows accountable for their predictions, the following graph compares the hard data from Industrial Products manufacturing subindex (dark blue bar) and US Census manufacturing shipments (lighter blue bar) to the Dallas Fed survey (light blue bar).
Comparing Surveys to Hard Data
In the above graphic, hard data is the long bars, and surveys are the short bars. The arrows on the left side are the key to growth or contraction.