Richmond and Dallas Fed Reports Slightly Less Optimistic

The production index of the Texas Manufacturing Outlook Survey dipped three points to 15.4. New orders edged up to 11.5 and the shipment index gained three points to register 9.4. The capacity utilization rate remained positive at 11.5 although falling slightly in April.

Input costs continued to feel upward pressure although pulling back slightly as the raw materials index lost four points to register 20.8. The finished goods prices index continued to be well above average gaining 4.5 points to register 12.0. Wages and benefits index was steady for the month. The employment index remained steady.

Texas manufacturers were slightly less optimistic in April compared to March. Indexes for future general business activity and future company outlook slipped to 27.1 and 26.2, respectively.

The Richmond Federal Reserve reported that the composite index for the Fifth District of Manufacturing Activity remained high with a reading of 20 in April, dropping 2 points from March. It was the first time since 1994 that the composite score was at or above 20 for two consecutive months.

The shipment index rose 8 points to register 25 while new orders remained strong at an unchanged reading of 26. Capacity utilization increased from a reading of 21 to 22. Finished inventory levels receded slightly while raw material inventories grew one point to an index reading of 24.

Prices paid rose slightly while prices received moderated, said survey respondents. The index for number of employees dropped to 5 from a reading of 20 in March along with a plunge in average workweek to an index reading of 8 from 21. Wages remained steady.

The Richmond outlook indexes for manufacturing slid somewhat from their March readings but were still strong and generally optimistic.