Kansas City Fed: Manufacturing Activity Slows in July

By July 28, 2011Economy

Mirroring other regional studies, the Federal Reserve Bank of Kansas City said that manufacturing activity slowed in July, with its composite index down from 14 in June to 3 in July. This news is disappointing as the June figure represented a rebound from weak May figures.

New orders, shipments, the backlog of orders, new exports, and the average workweek all contracted from the previous month. Production, inventories and the number of employees grew, but at a slower rate than in June.

Pricing pressures remained, with 49 percent of respondents citing increased costs for raw materials. Yet, only 23 percent noted higher prices for finished products.

Manufacturers remained more upbeat about the next six months relative to the current economic environment. The composite index for expected manufacturing activity was virtually unchanged from June, however. Breaking that down, predictions of higher shipments and capital expenditures were offset by slower expected growth in production, exports, and the average workweek.

Chad Moutray is chief economist, National Association of Manufacturers.

Chad Moutray

Chad Moutray

Chad Moutray is chief economist for the National Association of Manufacturers (NAM) and the Director of the Center for Manufacturing Research for The Manufacturing Institute, where he serves as the NAM’s economic forecaster and spokesperson on economic issues. He frequently comments on current economic conditions for manufacturers through professional presentations and media interviews. He has appeared on Bloomberg, CNBC, C-SPAN, Fox Business and Fox News, among other news outlets.
Chad Moutray

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  • 14 to 3? We’re seeing the summer slowdown but that’s rough. We’re seeing a smaller hit up here in Utah than other regions but we’re hoping for better numbers over the next six months for everybody!

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