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Kansas City Fed

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Kansas City Fed: Manufacturing Activity Contracted Again in July

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After slightly expanding for the first time since January 2015 in June, manufacturing activity in the Kansas City Federal Reserve Bank’s district contracted once again in July. The composite index of general business conditions dropped from 2 in June to -6 in July. This region has been challenged for much of the past two years by pullbacks in the energy sector and the stronger U.S. dollar, and the sample comments suggest that post-Brexit anxieties might have lowered sentiment in this release’s data. New orders (down from 4 to -5), production (down from 12 to -15) and shipments (down from 10 to -17) all returned to negative territory for the month. One-third of all respondents saying that their sales were lower in July, with 28 percent suggesting that sales were higher and 37 percent noting no change. At the same time, the rate of decline somewhat for both hiring (down from -4 to -5) and exports (down from -1 to -7). Interestingly, the average workweek (up from 1 to 7) widened in this report. Read More

Kansas City Fed: Manufacturing Activity Expanded Slightly for the First Time Since January 2015

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The Kansas City Federal Reserve Bank said that manufacturing activity expanded slightly for the first time since January 2015. The composite index of general business conditions rose from -5 in May to 2 in June. New orders (up from -3 to 4), production (up from -11 to 12), shipments (up from -6 to 10) and the average workweek (up from -15 to 1) were all better in this month’s report, with each measure shifting into positive territory after several months of contraction. Yet, it was not all good news, with lingering challenges still present. Along those lines, hiring (up from -13 to -4), the backlog of orders (up from -19 to -3) and exports (up from -8 to -1) continued to decrease, albeit with some easing in June in the rate of decline in this release. In addition, the sample comments suggest that respondents remain cautious in their outlook, stressing ongoing challenges in the marketplace. Read More

Kansas City Fed: Manufacturing Activity Continued to Decline in May

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The Kansas City Federal Reserve Bank said that manufacturing activity continued to decline in May, contracting for the 15th straight month. The Fed district continued to grapple with weaknesses in the agricultural and energy markets, with the strong dollar also challenging international demand. New orders (down from -2 to -3), production (down from -8 to -11), shipments (unchanged at -6), exports (down from -4 to -8), employment (down from -12 to -13) and the average employee workweek (down from -9 to -15) were all solidly in negative territory once again. Interestingly, respondents to this month’s survey were broken down into equally-divided groups, with one-third experiencing higher sales, one-third seeing reduced sales and the remaining one-third reporting no change in May.

Meanwhile, the forward-looking data suggest that manufacturers in the Kansas City Fed region are marginally positive about the next six months. The future-oriented composite index dropped from 10 to 4 but remained positive for the second straight month. The pace of growth for new orders (down from 20 to 15) and production (down from 25 to 15) remained decent moving forward, albeit with some easing in this release. At least 35 percent of those completing the survey anticipate demand and output to improve in the second half of this year, with no more than 24 percent seeing declines. On the other hand, exports (down from 1 to -3), hiring (down from 8 to -4), capital spending (up from -6 to -3) were each expected to decline over the next six months. This will likely mean that, even with some optimism for better activity ahead, business leaders will remain cautious.

regional Fed

Kansas City Fed: Manufacturing Activity Continued to Decline in April, but the Outlook Improved

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The Kansas City Federal Reserve Bank said that manufacturing activity continued to decline in April, contracting for the 14th straight month. Reduced crude oil prices, the strong dollar and weaknesses abroad have pressured the sector’s performance, especially since the district includes energy-intensive Oklahoma. With that said, the pace of decline slowed for production (up from -14 to -8), shipments (up from -15 to -6), exports (up from -10 to -4) and the average workweek (up from -10 to -6). New orders remained slightly negative (unchanged at -2), and hiring continued to lag behind (unchanged at -12). Despite the negative seasonally-adjusted figure, one-third of respondents had increased new orders for the month, with 29 percent citing declines.

Meanwhile, the forward-looking data composite index returned to positive territory, up from -2 in March to 10 in April, its highest level in 14 months. Indeed, manufacturers in the Kansas City Fed’s district appeared to be more upbeat in April, with greatly-improved assessments for future orders (up from zero to 20), production (up from 5 to 25) and shipments (up from 5 to 27). More than 40 percent of those completing the survey expected increases in each of those three activities over the next six months. In addition, more respondents expect increased employment (up from 1 to 8) and a longer average workweek (up from 3 to 8), with modest gains seen in the labor market. Nonetheless, it was not all good news. Exports (up from zero to 1) were anticipated to remain marginally positive over the coming months, and capital expenditures (up from -9 to -6) were expected to continue to contract.

Kansas City Fed: Manufacturing Activity Has Declined for 13 Straight Months

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The Kansas City Federal Reserve Bank said that manufacturing activity in its district has declined for 13 straight months. Still, the composite index of general business conditions increased from -12 in February to -6 in March, its best reading (albeit negative) since November. Reduced crude oil prices, the strong dollar and weaknesses abroad have pressured the sector’s performance, especially since the district includes energy-intensive Oklahoma. The slight improvement in the overall pace of decline in March reflected some stabilization for new orders (up from -15 to -2). Along those lines, the percentage of respondents saying that their new orders had increased for the month rose from 18 percent in February to 32 percent in March, which was somewhat encouraging.

Yet, other measures pulled back in March, indicating that manufacturers in the region remain highly challenged. This included production (down from -8 to -14), shipments (down from -11 to -15) and exports (down from -6 to -10). The labor market data eased marginally in their rate of growth for the month, but the pace of decline for hiring (up from -20 to -12) and the average workweek (up from -14 to -13) indicated that employment growth remained a significant problem. Looking at all of the current data, it should not be a surprise that manufacturers in the region remained anxious. Read More

Kansas City Fed: Manufacturing Activity Has Declined for 12 Straight Months

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The Kansas City Federal Reserve Bank said that manufacturing activity in its district has declined for 12 straight months. The composite index of general business conditions fell from -9 in January to -12 in February, its lowest level since April 2009. Reduced crude oil prices, the strong dollar and weaknesses abroad have pressured the sector’s performance. The data were negative across-the-board, including new orders (up from -27 to -15), production (unchanged at -8), shipments (down from -7 to -11), exports (down from 1 to -6), employment (down from -7 to -20) and the average employee workweek (down from -7 to -14). Half of all respondents said that they experienced no change in new orders for the month, with 30 percent noting declining sales. As such, it should not be a surprise that manufacturers in the region remained anxious.

With that said, manufacturing leaders in the Kansas City Fed area were cautiously positive in their outlook for the next six months, but not overwhelmingly so. The forward-looking composite index edged down from 5 to 4. At the same time, new orders (up from 13 to 15), production (up from 14 to 16) and shipments (up from 18 to 20) are expected to increase at decent rates in the months ahead, which should provide some encouragement. Yet, other indicators reflect ongoing softness in the market. For instance, the labor market is anticipated to remain weak, including hiring (down from 5 to 3) and the average workweek (up from -8 to 1), and capital spending is seen declining (down from -1 to -9). Exports (down from 2 to -1) are also predicted to be slightly negative over the next six months.

Kansas City Fed: Manufacturing Activity Declined for the 8th Straight Month, but Stabilized in October

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The Kansas City Federal Reserve Bank said that manufacturing activity in its district declined for the eighth straight month, but it stabilized a bit in October. The composite index of general business conditions improved from -8 in September to -1 in October. This measure has been in negative territory in each month since March, with reduced crude oil prices, the strong dollar and weaknesses abroad pressuring the sector’s performance. At the same time, the October headline number was not far from being neutral, providing some encouragement. Indeed, much of this increase stemmed from a recovery in the pace of new orders (up from -8 to 7), its first positive reading so far this year, with production (up from 1 to 4) expanding slightly for the second consecutive month. Read More

Kansas City Fed: Outlook for Next Six Months Turned Negative in September

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Manufacturing activity in the district continued to decline, according to the latest survey from the Kansas City Federal Reserve Bank. The composite index of general business activity increased from -9 in August to -8 in September, and it has contracted for seven straight months. Much of that weakness stems from lower crude oil prices and the strong U.S. dollar, with several sample comments noting business difficulties with these issues.

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Kansas City Fed: Manufacturing Activity Has Declined for Six Straight Months

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The Kansas City Federal Reserve Bank said that manufacturing activity in its district has declined for six straight months. The composite index of general business conditions edged lower, down from -7 in July to -9 in August, with this measure in solid negative territory since March. Overall, manufacturers continue to report contracting levels of activity, with reduced crude oil prices, the strong dollar and weaknesses abroad pressuring the sector’s performance. Indeed, various measures of activity were negative across-the-board. This included new orders (down from -6 to -9), production (down from -5 to -16), shipments (down from -2 to -15) and exports (up from -10 to -4). Exports have now declined for eight consecutive months. Read More

Kansas City Fed: Manufacturing Activity Declined for the Fifth Straight Month in July

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The Kansas City Federal Reserve Bank said that manufacturing activity declined for the fifth straight month in July, albeit at a slower pace than in either May or June. The composite index of general business conditions increased from -13 in May to -9 in June to -7 in July. Overall, manufacturers continue to report contracting levels of activity, with reduced crude oil prices, the strong dollar and weaknesses abroad pressuring the sector’s performance. Indeed, various measures of activity were negative across-the-board, even with some of them showing a slower rate of decline for the month. This included new orders (down from -3 to -6), production (up from -21 to -5), shipments (up from -15 to -2) and exports (down from -5 to -10). Exports have now declined for seven consecutive months. Read More