Of the three regional Federal Reserve surveys released to date, two are in expansion whilst the Richmond survey has mutated to the dark side.
Analyst Opinion of Richmond Manufacturing
The important Richmond Fed subcategories significantly decelerated – and are now in contraction, The internals are much worse than last month.
Market expectations from Bloomberg / Econoday was 14 to 20 (consensus 16). The actual survey value was -3 [note that values above zero represent expansion].
Results of the most recent survey from the Richmond Fed suggest that Fifth District manufacturing activity slowed in April. The composite index dropped sharply from 15 in March to −3 in April, its first negative reading since September 2016. The index was weighed down by a contraction in shipments and new orders; however, its third component, employment, rose slightly and remained in expansionary territory. The negative reading of the local business conditions index also suggested worsening conditions for District manufacturers, but surveyed firms were generally optimistic that they would see overall growth in the next six months.
Survey results indicate that capital expenditures and wages increased among District manufacturing firms in April as both indicators reached record-high values of 31 and 27, respectively. Despite rising wages, firms continued to report difficulty in finding necessary skills.
Firms saw increased growth in prices paid in April, but growth of prices received continued to slow. Manufacturers expected to see faster growth in both prices paid and prices received in the coming months.
Summary of all Federal Reserve Districts Manufacturing:
Richmond Fed (hyperlink to reports):
z richmond_man.PNG
Kansas Fed (hyperlink to reports):
z kansas_man.PNG
Dallas Fed (hyperlink to reports):
z dallas_man.PNG
Philly Fed (hyperlink to reports):
z philly fed1.PNG
New York Fed (hyperlink to reports):
z empire1.PNG
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 Richmond Fed survey (darkest bar).
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.
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