Of the four Federal Reserve districts which have released their October manufacturing surveys – all are in expansion.
Analyst Opinion of Dallas Fed Manufacturing Survey
Important subindices new orders improved (remains in expansion) and unfilled orders marginally declined (remains in expansion). This should be considered a little better than last month.
The expectations from Econoday were —- to —- (consensus —–) for the production index and the reported value was 25.5. From the Dallas Fed:
Texas factory activity expanded in October for the fifth month in a row following a record contraction due to the COVID-19 pandemic, according to business executives responding to the Texas Manufacturing Outlook Survey. The production index, a key measure of state manufacturing conditions, rose three points to 25.5, indicating a slight acceleration in output growth.
Other measures of manufacturing activity also point to stronger growth this month. The new orders index advanced five points to 19.9, and the growth rate of orders index inched up to 14.3. The capacity utilization index rose from 17.5 to 23.0, while the shipments index was largely unchanged at 21.9.
Perceptions of broader business conditions continued to improve in October. The general business activity index pushed further above average, coming in at 19.8, a two-year high. The company outlook index moved up three points to 17.8, also a two-year high. Uncertainty regarding companies’ outlooks continued to rise, with the index moving up four points to 11.0.
Labor market measures indicated continued but slower growth in employment and work hours. The employment index remained positive but fell from 14.5 to 8.7, suggesting less-robust hiring. Twenty percent of firms noted net hiring, while 11 percent noted net layoffs. The hours worked index remained positive but moved down from 6.9 to 3.7.
Prices and wages increased in October. The raw materials prices index edged up three points to 29.4, a reading several points above the series average. The finished goods prices and wages and benefits indexes inched up to 6.8 and 16.5, respectively. Both readings are roughly in line with their respective average readings.
Expectations regarding future activity remained positive in October. The future production index held steady at 47.2, and the future general business activity index was unchanged at 28.4. Other measures of future manufacturing activity showed mixed movements but remained solidly in positive territory.
Dallas Fed (hyperlink to reports):
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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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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 (red 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.
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