3 of 4 regional surveys in July show expansion.
TENTH DISTRICT MANUFACTURING SURVEY ROSE MODERATELY
The Federal Reserve Bank of Kansas City released the July Manufacturing Survey today. According to Chad Wilkerson, vice president and economist at the Federal Reserve Bank of Kansas City, the survey revealed that Tenth District manufacturing activity rose moderately, although producers’ expectations for future activity eased somewhat.
“We saw several positive things in this month’s survey. Production and shipments rebounded after being disrupted by storms last month,” said Wilkerson. “And while some firms remain hesitant to expand, overall capital spending and hiring plans remain positive.”
The month-over-month composite index was 6 in July, up from -5 in June and 2 in May (Tables 1 & 2, Chart). The composite index is an average of the production, new orders, employment, supplier delivery time, and raw materials inventory indexes. Production increased at both durable and non-durable goods-producing plants, particularly in food, machinery, and aerospace products. Most other month-over-month indexes also improved. The production index increased from -17 to 21, its highest level since June 2011, and the shipments and new orders indexes also rose markedly. In contrast, the order backlog index edged lower from -4 to -7, and the employment index also eased slightly. The finished goods inventory index fell from 6 to 1, while the raw materials inventory index was unchanged.
The majority of year-over-year factory indexes were slightly lower or unchanged from the previous month. The composite year-over-year index eased from 3 to 2, and the new orders and order backlog indexes also decreased.The production, employment, and new orders for exports indexes remained stable, while the capital expenditures index edged down from 16 to 11 after increasing last month. On the other hand, the shipments index increased from 6 to 9, and both inventory indexes also moved higher.
Most future factory indexes moderated somewhat in July but still remained relatively solid. The future composite index eased from 12 to 7, and the future production, shipments, and new orders indexes also edged lower. The future order backlog index declined from 14 to 0, and the future capital expenditures index decreased for the second straight month. The future new orders for export index fell into negative territory, while the future employment index was unchanged. The raw materials inventory index declined from -2 to -13, and the finished goods inventory index also decreased.
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 Kansas City Survey (pea-green 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.