Tag: manufacturing activity

Kansas City Fed Reported Contracting Activity for the Third Consecutive Month in May

The Kansas City Federal Reserve Bank said that manufacturing activity contracted for the third consecutive month in May. The composite index dropped from -7 in April to -13 in May, suggesting a sharper drop in activity than the month before. Indeed, several of the key data points declined at faster rates in May than in April. This included new orders (down from -12 to -19), production (down from -2 to -13), shipments (down from -7 to -9) and the average workweek (down from -10 to -14). At the same time, employment (up from -18 to -17) decreased sharply, and exports (up from -12 to -9) contracted for the fifth straight month, even as both measures fell at slightly slower paces for the month. (continue reading…)

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Philly Fed: Manufacturing Outlook Eased Slightly in May

The Philadelphia Federal Reserve Bank said that the manufacturing outlook eased slightly in May. The composite index of general business activity dropped from 7.5 in April to 6.7 in May. In general, the outlook has weakened so far this year relative to last year, with the headline measure averaging 6.1 through the first five months of 2015. This compares to the more-robust average of 25.1 observed in the second half of 2014, with the softness experienced year-to-date largely the result of a number of headwinds seen in the U.S. and global economy. At the same time, manufacturers in the Philly Fed district have reported expanding levels of activity for 15 straight months. (continue reading…)

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ISM: Headline Number Unchanged at 51.5, but Orders and Production Rebounded a Little

The Institute for Supply Management’s (ISM) manufacturing purchasing managers’ index (PMI) was unchanged at 51.5 in April. On the positive side, manufacturing activity has continued to expand very modestly, and yet, these data reflect softness in the market seen over the past few months. Six months ago, for instance, the PMI value was 57.9, and this headline number has trended lower since then. Demand and output have shifted into a lower gear on challenges from a stronger U.S. dollar, reduced crude oil prices, residual impacts from the West Coast ports slowdown, and other factors. The sample comments note that these headwinds were top-of-mind for survey respondents in this report. (continue reading…)

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Dallas Fed: Manufacturers Continue to Struggle on Crude Oil, Dollar Woes

The Dallas Federal Reserve Bank said that manufacturing activity contracted in Texas for the fourth straight month. The composite index of general business conditions rose from -17.4 in March to -16.0 in April, suggesting a slightly slower pace of decline for the month. Yet, it is clear that manufacturers in the district are struggling with lower crude oil prices and a stronger U.S. dollar. Each was mentioned several times in the sample comments, providing a double whammy to the Texas economy. Nearly 28 percent of manufacturing respondents to the survey suggested that conditions had worsened in April, versus 11.7 percent indicating some improvement. (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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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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Durable Goods Orders and Shipments Were Soft in February

The Census Bureau said that new durable goods orders declined 1.4 percent in February, falling for the fifth time in the past seven months. Much of the decrease in February stemmed from reductions in the demand for transportation equipment, with new orders in that sector down 3.5 percent in February. This included a reduction in sales for motor vehicles and parts (down 0.5 percent for the month) and fewer nondefense and defense aircraft orders (down 8.9 percent and 33.1 percent, respectively). Note that aircraft orders can be quite volatile from month to month, as nondefense aircraft orders had increased 122.2 percent in January. Therefore, we often look at this data by stripping out the transportation equipment sector, and when you do so, durable goods orders decreased by 0.4 percent – still a soft figure. This mirrors other data showing a number of headwinds dampening demand and output in the early months of 2015. (continue reading…)

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Richmond Fed: Manufacturing Activity Contracted in March

The Richmond Federal Reserve Bank said that manufacturing activity contracted in March, declining for the first time in 12 months. The composite index of general business conditions decreased from zero in February to -8 in March. The underlying data were lower across-the-board, reflecting weaknesses for the month in terms of overall activity and a deterioration from February’s numbers. This included new orders (down from -2 to -13), shipments (down from -1 to -13), capacity utilization (down from -4 to -7) and the average workweek (up from -6 to -4). As such, manufacturers clearly pulled back in a number of areas for the month, likely due to global slowness, a stronger dollar and reduced commodity prices. On the positive side, hiring (up from 4 to 6) continued to grow modestly, providing some encouragement moving forward. (continue reading…)

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Markit: Chinese Manufacturing Activity Declined Again

The HSBC Flash China Manufacturing PMI reflected reduced activity again, down from 50.7 in February to 49.2 in March. It has contracted in three of the past four months now, reflecting a decelerated rate of growth in China. China has reduced its target real GDP growth rate for 2015 to 7 percent. New orders (down from 50.4 to 49.3), exports (up from 47.1 to 49.0) and employment (down from 49.3 to 47.0) were all below 50 in March – the threshold signifying growth. It was the reduction in demand that pushed the headline index lower. On the positive side, output (unchanged at 50.8) continues to expand very modestly for the month, and the decrease in input prices (up from 42.2 to 44.7) have helped manufacturers in terms of costs, even as the rate of decline was less in March. (continue reading…)

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Philly Fed: Modest Manufacturing Growth in the District in March

The Federal Reserve Bank of Philadelphia reported that manufacturing activity has expanding modestly in March. The composite index of general business activity edged marginally lower, down from 5.2 in February to 5.0 in March. Overall activity has been softer-than-desired in the first three months of 2015, averaging just 5.5; whereas, the composite index had averaged a more robust 18.6 for 2014 as a whole. Nonetheless, the Manufacturing Business Outlook Survey has now expanded for 13 straight months, and business leaders in the district remain relatively optimistic about the coming months. (continue reading…)

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