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manufacturing activity

New Durable Goods Orders Expanded for the Second Straight Month, Continuing to Show Progress

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The Census Bureau said that new durable goods orders expanded for the second straight month, up 1.7 percent in February after rising by 2.3 percent in January. New orders increased from $231.53 billion in January to $235.39 billion in February, a four-month high. However, much of the gain in February could be explained by a large jump in nondefense aircraft and parts orders, up 47.6 percent, which can often be quite volatile from month-to-month. Excluding transportation, new orders for durable goods rose 0.3 percent for the month, up from $154.41 billion to $154.99 billion. Overall, new durable goods demand has continued to trend in the right direction after stalling for much of the past couple years. New durable goods orders have increased 5.1 percent since February 2016’s $224.08 billion pace; excluding transportation, orders grew 4.6 percent year-over-year, up from $148.14 billion. Read More

Kansas City Fed: Manufacturing Activity Expanded in February at Fastest Rate since May 2011

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The Kansas City Federal Reserve Bank said that manufacturing activity expanded in March at its fastest rate since May 2011. The composite index of general business conditions rose from 14 in February to 20 in March, expanding for the fourth straight month. As such, manufacturing conditions have continued to improve after notable challenges over the past two years from global headwinds and reduced commodity prices, especially for crude oil. Outside of the headline number, the underlying indices also suggested relatively very robust gains in new orders (up from 26 to 32), production (up from 11 to 37) and shipments (up from 16 to 35). There was some easing for the employment (down from 17 to 13), the average workweek (down from 15 to 13) and exports (down from 9 to 2), but each of these indices remained promising overall. Exports, for instance, were positive for only the second time in the past 16 months. Read More

New York Fed: Manufacturing Activity Continued to Grow Strongly in March

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The Empire State Manufacturing Survey said that manufacturing activity continued to expand at a healthy pace, even as it pulled back in March from the fastest pace in 30 months in February. The composite index of general business conditions eased from 18.7 in February to 16.4 in March, expanding for the fifth straight month. In the latest data, there were signs that of notable improvements in activity in the district, including new orders (up from 13.5 to 21.3), employment (up from 2.0 to 8.8) and the average workweek (up from 4.1 to 15.0). The orders index was at its highest point since April 2011, with 39.4 percent of respondents indicating increased sales in March relative to February’s levels. Read More

Manufacturing Construction Picked Up a Little in January but Remained Soft

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The Census Bureau said that private manufacturing construction spending picked up a little in January after falling to a 2-year low in December. The value of construction put in place in the sector rose from $69.06 billion in December to $69.47 billion in January. While manufacturing construction has largely trended higher over the past few years, activity has stalled more recently as the sector has grappled with sluggish growth and economic and political anxieties. Along those lines, construction activity in the manufacturing sector has pulled sharply lower since achieving the all-time high of $82.15 billion in September 2015. Over the past 12 months, manufacturing construction spending has fallen 6.8 percent. Read More

ISM: Manufacturing Activity Expanded in February at Its Fastest Rate Since August 2014

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The Institute for Supply Management’s (ISM) Manufacturing PMI expanded at its fastest rate since August 2014. The composite index rose from 56.0 in January to 57.7 in February, and it marked the sixth straight monthly expansion in the headline number. Indeed, manufacturing sentiment has soared in recent months, buoyed by expectations that demand and output will benefit from possible pro-growth policies emanating from Washington. Indeed, all of the sample comments echoed this optimism, citing a “very positive outlook,” “solid” demand and “strong” growth. Along those lines, new orders (up from 60.4 to 65.1) and production (up from 61.4 to 62.9) both indicated healthy gains for the month, with sales growth at levels not seen since December 2013. In addition, exports (up from 54.5 to 55.0) also picked up a little, which was refreshing given the struggles with increasing international sales over the past couple years. Read More

Richmond Fed: Expected Manufacturing New Orders Rose to Highest Point in Survey’s 23-Year History

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The Richmond Federal Reserve Bank said that manufacturing activity in its district expanded at its fastest rate in 11 months. The composite index of general business activity increased from 12 in January to 17 in February, marking the fourth straight monthly expansion in the mid-Atlantic region. Indeed, new orders (up from 15 to 24), shipments (up from 13 to 16), capacity utilization (up from 8 to 15), employment (up from 8 to 10) and the average workweek (up from 5 to 16) each accelerated in the latest survey. New orders grew at the briskest pace since April 2010, which should bode well for activity moving forward, particularly if it can be sustained. Read More

Dallas Fed: Manufacturing Sentiment Expanded in February at Fastest Rate Since April 2006

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The Dallas Federal Reserve Bank reported that manufacturing activity expanded in February at its fastest rate since April 2006. The composite index of general business conditions increased from 22.1 in January to 24.5 in February, expanding for the fifth consecutive month after contracting for much of the past two years. The recent gains in business confidence can largely be attributed to better energy commodity prices and from a post-election boost in optimism, especially as it relates to expectations regarding pro-growth policies. At the same time, the sample comments also suggest a number of anxieties, including a strong U.S. dollar, uncertainties about trade policy moving forward and continuing challenges in attracting qualified labor. Read More

Strong Aircraft Sales in January Help New Durable Goods Orders Rebound

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The Census Bureau said that new durable goods orders rose 1.8 percent in January, up for the first time in three months. New orders increased from $226.3 billion in December to $230.4 billion in January. However, volatility in the transportation equipment segment, which can often have large shifts from month to month, skewed the data. Defense and nondefense aircraft and parts orders jumped 59.9 percent and 69.9 percent, respectively, in January. Excluding transportation, new orders for durable goods fell 0.2 percent for the month, down from $154.3 billion to $153.9 billion. To be fair, December’s level, which had been the fastest pace since September 2014, appeared to be a bit of an outlier. Over the past 12 months, new durable goods orders declined 0.6 percent; however, this figure grew 2.4 percent year-over-year when excluding transportation equipment. As such, the broader durable goods market—outside of aircraft—continues to improve somewhat after struggling mightily over the past two years on global challenges. Read More

Kansas City Fed: Manufacturing Activity Expanded in February at Fastest Rate Since June 2011

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The Kansas City Federal Reserve Bank said that manufacturing activity expanded in February at its fastest rate since June 2011. The composite index of general business conditions rose from 9 in January to 14 in February, expanding for the third straight month. As such, manufacturing conditions have continued to improve after notable challenges over the past two years from global headwinds and reduced commodity prices, especially for crude oil. Outside of the headline number, the underlying indices also suggested relatively healthy gains in new orders (up from 20 to 26), production (down from 20 to 11), shipments (down from 20 to 16), employment (up from 6 to 17) and the average workweek (up from 9 to 15), even with some easing in a couple of these measures. Exports (up from -5 to 9) were also stronger in the month, with positive growth for the first time in 15 months.

At the same time, manufacturers continue to be quite upbeat about the next six months, mirroring sentiment seen in other recent regional reports. The forward-looking composite index edged up from 27 to 29, its highest reading in the survey’s 16-year history. To illustrate the figure, 59 percent of respondents expect production to be higher moving forward, with 18 percent seeing declines in output. More than half also anticipate increased sales and shipments, with one-third predicting more hiring and 39 percent planning more capital spending. The exports data were also encouraging, particularly given that they have been a major drag for the Kansas City Fed region over the past couple years, with that index up from 4 to 13, a level not seen since June 2013.

Philly Fed: Manufacturing Activity Accelerated in February at Strongest Rate Since November 1983

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The Federal Reserve Bank of Philadelphia said that manufacturing activity expanded in February at its strongest rate since November 1983. The composite index of general business activity rose from 23.6 in January to 43.3 in February, with 48.2 percent of survey respondents suggesting that conditions had improved this month. Just 4.8 percent said that conditions had worsened. Other measures were also uplifting, including new orders (up from 26.0 to 38.0), shipments (up from 20.5 to 28.6) and the average employee workweek (up from 6.8 to 13.6). Growth in hiring (down from 12.8 to 11.1) continued to expand modestly despite some easing in the current release. Read More