Tag: Kansas City Fed

Monday Economic Report – April 27, 2015

Here is the summary for this week’s Monday Economic Report:

Durable goods orders jumped 4.0 percent in March, which should be a sign that the sector was growing strongly and rebounding from recent softness. Instead, strong aircraft and motor vehicle sales in the month masked broader weaknesses behind the surface. Excluding transportation equipment orders, durable goods sales dropped 0.2 percent for the month and have edged lower across the past six months. Durable goods shipments were somewhat more encouraging on a year-over-year basis, up 3.7 percent, but they have been essentially flat since September. (continue reading…)

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Kansas City Fed: Manufacturing Sentiment Fell Further in April

The Kansas City Federal Reserve Bank said that manufacturing sentiment fell further in April, contracting for the second straight month. The composite index of general business conditions declined from -4 in March to -7 in April. The sample comments tick off a number of challenges for manufacturers in the district, including the strong U.S. dollar, lower crude oil prices, continuing logistics problems from the West Coast ports slowdown and global competition. The index for new export orders (down from -9 to -12) was negative for the fourth consecutive month, reflecting the dollar’s strength and weaknesses abroad. (continue reading…)

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Monday Economic Report – March 30, 2015

Here is the summary for this week’s Monday Economic Report: 

As we have seen in past weeks, economic data continue to reflect dampened activity in the early months of 2015 as a result of a number of significant headwinds. These challenges range from weak economic growth abroad, to a significantly strengthened U.S. dollar, to the sharp drop in crude oil prices. Weather and the West Coast ports slowdown have also been relevant factors in some of the softness that we have seen in the reports released since December. As a result, the first quarter is likely to grow around 1.8 percent. This would be less than the 2.2 percent growth rate in real GDP seen during the fourth quarter. Nonetheless, I am predicting 2.8 percent growth in real GDP in 2015, reflecting a slight deceleration in my outlook for the year. The expectation is that we will see some rebounds moving forward, with manufacturers continuing to be more upbeat about the coming months, even with some challenges likely to continue. (continue reading…)

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Kansas City Fed: Reduced Manufacturing Activity in March

The Kansas City Federal Reserve Bank said that manufacturing activity declined in March, contracting for the first time in 12 months. The composite index of general business conditions declined from 1 in February to -4 in March. Perhaps more worrisome, the decline in new orders accelerated (down from -10 to -20), falling for the third straight month. The sample comments provide clues about why this is the case, with respondents noting a number of headwinds impacting their demand. These include snowstorms, reduced crude oil prices, the stronger U.S. dollar and the West Coast ports slowdown. (continue reading…)

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Monday Economic Report – March 2, 2015

Here is the summary for this week’s Monday Economic Report: 

While manufacturers remain mostly optimistic in their outlook, we have seen softness in a number of recent economic indicators. Slower economic growth internationally, a stronger U.S. dollar, reduced crude oil prices and the West Coast ports slowdown have been cited as reasons for this weaker-than-desired performance. Along those lines, real GDP growth in the fourth quarter was revised lower, down from 2.6 percent to 2.2 percent. In addition, surveys from the Dallas, Kansas City and Richmond Federal Reserve Banks all reflected decelerated levels of new orders and exports. Most notably, Texas manufacturers have been adversely impacted by the sharp drop in petroleum prices, dampening demand throughout the energy supply chain and for the larger regional economy. Yet, even in the Dallas report, respondents continued to be more positive than negative in their expectations for sales, production, employment and capital spending over the next six months. (continue reading…)

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Kansas City Fed: Manufacturing Activity Slowed to a Near Crawl in February

The Kansas City Federal Reserve Bank said that manufacturing activity slowed to a near crawl in February, mirroring the easing we have seen in other regions. The composite index of general business conditions dropped has declined from 8 in December to 3 in January to 1 in February. The silver lining, of course, is that activity in the sector continues to expand, albeit barely, as it has now for 14 straight months. Still, the weaker headline figure was pulled lower by contracting levels of new orders (down from -8 to -10), exports (down from -7 to -13) and employment (down from zero to -4). There were several reasons cited in the sample comments for the softness, including sluggish global growth, reduced crude oil prices and the West Coast ports slowdown. (continue reading…)

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Monday Economic Report – January 26, 2015

Here is the summary for this week’s Monday Economic Report: 

The European Central Bank (ECB) finally announced its long-awaited quantitative easing program on Thursday. The ECB will purchase 60 million euros in bonds each month until September 2016—totaling at least 1.1 trillion euros overall—in an attempt to stimulate growth. Depending on where the Eurozone economy stands pointing September 2016, the ECB might extend its purchasing beyond that point. The impact on the euro was almost immediate, with the euro exchanging for $1.1206 at Friday’s close, down from $1.3927 on March 17, the high point of 2014. This will complicate manufacturers’ ability to sell goods into Europe, something that was mentioned in the sample comments in the latest Kansas City Federal Reserve Bank’s monthly survey (see below). (continue reading…)

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Kansas City Fed: Manufacturers Began the New Year on a Softer Note

The Kansas City Federal Reserve Bank said that manufacturing activity slowed in January, beginning the new year on a softer note. The composite index of general business conditions dropped from 8 in December to 3 in January, its lowest level in five months. Underlying this figure, new orders (down from 14 to -8), production (down from 7 to -2), shipments (down from 8 to -5) and exports (down from zero to -7) declined for the month, and hiring (down from 8 to zero) stagnated. On the positive side, it was the 13th straight month with expanding levels of sentiment, and manufacturers remain mostly optimistic about the coming months. (continue reading…)

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Kansas City Fed: Manufacturing Activity Picked Up Somewhat in December

The Kansas City Federal Reserve Bank said that manufacturing activity picked up somewhat in December. The composite index of general business conditions increased from 7 in November to 8 in December, accelerating for the second straight month. More importantly, the indices for new orders (up from 1 to 12) and shipments (up from 7 to 15) reflect some strengthening in demand and output after a weaker-than-desired October and November in the district. The pace of production and hiring reflected decent growth, with measures for both unchanged for the month. Another positive was the continuing deceleration in raw material costs, with that index down from 20 in September to 5 in December. Reduced energy prices likely accounted for this shift in cost pressures. (continue reading…)

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Monday Economic Report – November 24, 2014

Here is the summary for this week’s Monday Economic Report:

Central banks around the world have acted recently in an attempt to lift a sagging global economy. On Friday, for instance, the European Central Bank (ECB) announced that it has begun purchasing asset-backed securities, finally beginning a quantitative easing program that some have long sought. Earlier in the day, ECB President Mario Draghi said that “we will do what we must” to spur economic growth. In addition, the People’s Bank of China surprised markets by cutting interest rates on Friday. These actions followed the Bank of Japan’s announcement on October 31 that it would increase the amount of its monthly asset purchases. (continue reading…)

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