All Federal Reserve districts have released their September surveys – and all but one are forecasting growth (one forecast is for zero growth). A complete summary follows.
Texas factory activity expanded in September, according to business executives responding to the Texas Manufacturing Outlook Survey. The production index, a key measure of state manufacturing conditions, rose from 7.3 to 11.5, suggesting output increased at a slightly faster pace than in August.
Other measures of current manufacturing activity indicated continued growth in September. The capacity utilizationindex rose 6 points to a reading of 10.7. The new orders index was 5, largely unchanged from its August level. Theshipments index edged down from 11.4 to 10.3.
Perceptions of broader business conditions improved further in September. The general business activity index jumped nearly 8 points to 12.8, its highest reading in a year and a half. The company outlook index posted a fourth consecutive positive reading and came in at 7.9, little changed from August.
Labor market indicators reflected continued employment growth but flat workweeks. The September employment index was 10, its third reading in a row in solidly positive territory. Seventeen percent of firms reported hiring new workers compared with 7 percent reporting layoffs. The hours worked index was near zero, indicating little change from August in average workweek length.
Upward pressure on prices picked up in September, while wage pressure abated. The raw materials price index increased from 10 to 17.6, posting its highest reading in six months. The finished goods price index also rose notably—from 4 to 10.6—reaching a 19-month high. The wages and benefits index was positive but moved down to 9.7, its lowest level since early 2011. Looking ahead, 38 percent of respondents anticipate further increases in raw materials prices over the next six months, while 27 percent expect higher finished goods prices.
Expectations regarding future business conditions remained optimistic in September. The indexes of future general business activity and future company outlook showed mixed movements but remained in strongly positive territory. Indexes for future manufacturing activity also remained solidly positive, and the index for future employment spiked 10 points to 21.9.
The Dallas Fed conducts the Texas Manufacturing Outlook Survey monthly to obtain a timely assessment of the state’s factory activity. Data were collected Sep. 17–25, and 90 Texas manufacturers responded to the survey. Firms are asked whether output, employment, orders, prices and other indicators increased, decreased or remained unchanged over the previous month.
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.