Economy
Federal Reserve Manufacturing Indexes Indicate Expansion
Written by Sandy Williams
March 28, 2017
Manufacturers are optimistic in the Texas and Richmond area, according to Federal Reserve surveys. Factory activity is expanding so far in 2017 and manufacturers continue to expect improvement during the next six months.
Texas Manufacturing Outlook Survey
Manufacturing in Texas experienced a ninth month of expansion in March, according to the Federal Reserve Bank of Dallas. The production index in the Texas Manufacturing Outlook Survey gained two points to register 18.6. New orders were softer in March after an unusually strong February, dipping 2.1 points to 9.5. Shipments decreased 5.7 points to a reading of 6.5.The growth rate for new orders increased 1.2 points and has been increasing for the past three months. Unfilled orders were flat in March and delivery times increased. Inventories were unchanged for raw materials while finished goods inventories decreased.
Prices continued to increase for both inputs and outputs but at a slower pace in March. Indices for employment levels and hours worked remained positive and increasing at readings of 8.4 and 8.7, respectively.
The current index for general business activity was positive at 16.9 although falling 8 points in March. The company outlook compared to the previous month was up 0.3 points to 17.9.
Future indicators remained positive for company outlook (39.1) and general business activity (36.3), but most of the indicators forecasting conditions six months ahead lost some ground in March.
Fifth District Survey of Manufacturing Activity
Manufacturing conditions were described as “upbeat” in March by the Federal Reserve Bank of Richmond. Indexes for shipments and new orders both rose this month, as did backlogs. The composite Index for the Fifth District rose to 22 from 17 in February for its best reading since April 2010. Pricing pressure moderated some and inventory levels of finished goods and raw materials increased.
Employment levels, work week length and wages all received a boost in March.
Looking ahead six months, employment indices remained strong for the District, but shipments, new orders, and capacity utilization are expected to decrease. Future input pricing is expected to moderate somewhat while selling prices improve.
Sandy Williams
Read more from Sandy WilliamsLatest in Economy
Fed Beige Book: Economy improves, but manufacturing weak
While general economic conditions across the US improved slightly over the last six weeks, activity in the manufacturing sector was weak, according to the Fed’s latest Beige Book report.
SMU Community Chat: Simonson with the latest on construction
A lot of economists were predicting a recession last year. Ken Simonson, chief economist for The Associated General Contractors of America (AGC), wasn’t one of them.
Housing starts slip to seven-month low in March
Following a strong February, US housing starts eased through March to a seven-month low, according to the most recent data from the US Census Bureau.
Manufacturing activity in New York state continues to soften
New York state saw a continued decline in manufacturing activity in April, according to the latest Empire State Manufacturing Survey from the Federal Reserve Bank of New York
Worldsteel projects steel demand to grow 1.7% this year
Global steel demand will reach roughly 1.793 million metric tons (1.976 million short tons) this year, an increase of 1.7% over 2023, the World Steel Association (worldsteel) said in its updated Short Range Outlook report. The gain will come after a 0.5% contraction in steel demand in 2023. Demand is forecasted to increase another 1.2% […]