All Federal Reserve districts have released their October surveys – and all are forecasting growth. A complete summary follows.
Texas factory activity picked up further in October, according to business executives responding to the Texas Manufacturing Outlook Survey. The production index, a key measure of state manufacturing conditions, rose from 11.5 to 13.3, suggesting output increased at a slightly faster pace than in September.
Other measures of current manufacturing activity also indicated a slightly stronger expansion in October. The new ordersindex came in at 6.2, slightly above its September level, and marked a sixth consecutive month of increased demand. Thecapacity utilization index edged up to 11.9, and the shipments index rose 3 points to 13.2.
Perceptions of broader business conditions were less optimistic in October. The general business activity index remained positive but fell to 3.6 after rising sharply to 12.8 in September. The company outlook index posted a fifth consecutive positive reading but moved down to 5.4.
Labor market indicators reflected continued employment growth and longer workweeks. The October employment index was 9.6, largely unchanged from its September level. Seventeen percent of firms reported hiring new workers compared with 7 percent reporting layoffs. The hours worked index turned positive for the first time in three months, coming in at 3.9, indicating an increase in average workweek length.
Upward pressure on prices continued in October, and compensation costs picked up notably. The raw materials priceindex moved up to 22.7, posting its highest reading in nine months. The finished goods price index remained positive for the third month in a row but fell 7 points to 3.5. The wages and benefits index rose sharply from 9.7 to 20.4, reaching its highest level since July 2012. Looking ahead, 39 percent of respondents anticipate further increases in raw materials prices over the next six months, while 34 percent expect higher finished goods prices.
Expectations regarding future business conditions remained optimistic in October. The indexes of future general business activity and future company outlook declined from September levels but remained in strongly positive territory. Most indexes for future manufacturing activity also fell while remaining solidly positive.
Source: Dallas Fed
Summary of all Federal Reserve Districts Manufacturing:
Richmond Fed (hyperlink to reports):
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Kansas Fed (hyperlink to reports):
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Dallas Fed (hyperlink to reports):
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Philly Fed (hyperlink to reports):
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New York Fed (hyperlink to reports):
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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
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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.