Tag

new orders

durable goods

Strong Aircraft Sales Pushed New Durable Goods Orders Sharply Higher in April

By | Economy, General, Shopfloor Economics | No Comments

The Census Bureau said that new durable goods orders increased 3.4 percent in April, extending the 1.9 percent gain seen in March. Sales of new durable goods orders rose from $228.3 billion in March to $235.9 billion in April. Demand have risen in three of the four months so far in 2016, providing some encouragement for a sector that has experienced its share of softness over the past year. On a year-over-year basis, sales have risen from $231.5 billion in April 2015, an increase of 1.9 percent. Yet, much of that gain came from transportation equipment, particularly aircraft sales. Excluding transportation, new orders for durable goods increased by just 0.4 percent, and over the past 12 months, that figure was down 1.4 percent. This suggests that demand remains somewhat weaker than the headline number would seem to indicate – a sign that durable goods manufacturers continue to be challenged beyond automobiles and aircraft. Read More

ISM

ISM: Manufacturing Activity Expanded for Second Straight Month, Slowing a Little in April

By | Economy, General, Shopfloor Economics | No Comments

The Institute for Supply Management’s (ISM) Manufacturing Purchasing Managers’ Index (PMI) expanded for the second straight month, albeit at a slower pace in April. The composite index declined from 51.8 in March to 50.8 in April, but even with the decrease, this represented progress in the manufacturing sector after contracting for five consecutive months from October through February. New orders (down from 58.3 to 55.8) and production (down from 55.3 to 54.2) each grew at decent rates for the month despite some easing in this release, and exports (up from 52.0 to 52.5) accelerated, increasing for only the third time in the last 12 months.

Last month’s release helped to fuel the narrative that manufacturing activity was starting to stabilize, and the current data mostly support that view. At the same time, though, manufacturers remain challenged by global headwinds and still-low commodity prices, and a number of economic indicators have been disappointing, highlighting the fact that business’ struggles are still far from over. The sample comments tended to echo this nuanced view of modest improvements, with some respondents noting a pickup in sales while others cited ongoing sluggishness. One’s perspective was likely industry-specific. Read More

durable goods

New Durable Goods Sales Rebounded Somewhat in March, but Weaker Than Expected

By | Economy, Shopfloor Economics | No Comments

The Census Bureau said that new durable goods orders increased by 0.8 percent in March, rebounding somewhat after the 3.1 percent decline seen in February. This was weaker-than-expected, with a consensus expecting a gain of 1.8 percent. Sales of new durable goods orders rose from $228.9 billion in February to $230.7 billion in March. Overall, demand remains quite soft, with the sector challenged by global headwinds and lingering anxieties in the economic outlook. Order volumes have been highly volatile from month-to-month over the course of the past year, with sales trending lower since peaking in 2015 at $241.0 billion in July. On a year-over-year basis, new durable goods orders have fallen 2.5 percent, down from $236.7 billion in March 2015. Even with transportation equipment sales excluded, year-over-year growth declined by 1.4 percent, with orders down 0.2 percent for the month, highlighting the broad-based softness of demand for durable goods over the past 12 months. Read More

Markit: U.S. Manufacturing Activity Grew at the Slowest Pace since September 2009

By | Economy, Shopfloor Economics | No Comments

U.S. manufacturing activity grew at the slowest pace since September 2009, according to preliminary figures from Markit. The Markit Flash U.S. Manufacturing PMI decreased from 51.5 in March to 50.8 in April. In general, the strong dollar and weaknesses abroad have dampened international demand and overall sentiment over the course of the past year. Manufacturing activity has decelerated significantly over the past 12 months, with the main PMI number down from 54.2 in April 2015. In this report, output (down from 51.4 to 50.3) and hiring (down from 52.1 to 50.2) each pulled back to a near-standstill, with exports (down from 50.0 to 48.5) contracting for the second time in the past three months. On the other hand, new orders (down from 52.8 to 52.0) continued to expand modestly, but with some easing for the month.

As such, this report stands in sharp contrast to the better-than-expected sentiment seen in the competing data from the Institute for Supply Management (ISM). In that release, new orders and output each grew surprisingly strong in March, lifting its manufacturing PMI value above 50 for the first time since August. It provided some encouragement after months of softness, even as other economic data – including this one from Markit – continue to suggest ongoing challenges. Read More

Markit: U.S. Manufacturing Activity Remained “Subdued” Despite Picking up a Little in March

By | Economy, Shopfloor Economics | No Comments

U.S. manufacturing activity remained “subdued” despite picking up a little in March, according to the latest figures from Markit. The Markit Flash U.S. Manufacturing PMI increased from 51.3 in February, its slowest pace in more than three years, to 51.4 in March. This suggests that manufacturing in the U.S. remains challenged despite some signs of progress, including accelerated growth for new orders (up from 51.7 to 52.8), output (up from 51.3 to 51.4) and hiring (up from 51.5 to 52.1). The pickup in demand is notable, even as the sales expanded at a much faster pace at this point last year, when the index for new orders stood at 56.4. On the other hand, exports (up from 49.1 to 50.0) were stagnant in March, stabilizing a bit after contracting in February. In general, the strong dollar and weaknesses abroad have dampened international demand and overall sentiment over the course of the past year, with the export index averaging 50.2 over the past 15 months. Read More

ISM

ISM: Manufacturing Contracted for the 5th Straight Month, but Offered Some Encouraging Signs

By | General, Shopfloor Economics | No Comments

The Institute for Supply Management (ISM) said that manufacturing activity has now contracted for five straight months. The manufacturing purchasing managers’ index increased from 48.2 in January to 49.5 in February but remained below the important threshold of 50 which would indicate the start of expansion. In that regard, this report continued to show weaker-than-desired data for manufacturers, with the sector challenged by global headwinds and reduced commodity prices. Indeed, exports (down from 47.0 to 46.5) remained in contraction territory, hurt by the strong dollar and economic softness for manufacturing goods to key markets.

Yet, this latest release also offered some signs of encouragement. For one thing, the headline index was higher than the consensus expectation of roughly 48.5, indicating that respondents were perhaps less downbeat than predicted. At the same time, some of the underlying data reflect stabilization  in activity from prior months. For instance, new orders (unchanged at 51.5) and production (up from 50.2 to 52.8) have now expanded for two consecutive months, with the latter growing at its fastest pace since August. Moreover, the pace of decline for hiring (up from 45.9 to 48.5) slowed in February, and pricing pressures (up from 33.5 to 38.5) remain virtually nonexistent.

This does not mean that manufacturing’s struggles are over, but this report does offer a glimpse of cautious optimism, with the ISM data coming in a bit stronger than anticipated. Even with this finding, manufacturers remain anxious in their economic outlook overall, and other reports continue to highlight softness in the marketplace. With that in mind, manufacturing leaders remain focused on implementing pro-manufacturing policies, including those outlined in the NAM’s “Competing to Win” document in this all-important election year and beyond.

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

By | Economy, Shopfloor Economics | No Comments

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.

Markit US PMI

Markit: U.S. Manufacturing Activity in February Eased to its Slowest Pace since October 2012

By | Economy, Shopfloor Economics | No Comments

The Markit Flash U.S. Manufacturing PMI fell to its slowest pace in more than three years in February, a sign that challenges hitting the sector have not yet abated. The composite measure declined from 52.4 in January to 51.0 in February, and in general, manufacturing activity has decelerated over the course of the past year, down from 55.1 in February 2015. On the positive side, new orders (down from 53.6 to 51.7), output (down from 53.2 to 51.3) and employment (down from 52.8 to 51.5) expanded somewhat, just not as far as we might prefer, with the rate of growth slowing in February for each. On the other hand, exports (down from 51.1 to 49.1) returned to negative territory after two months of progress, a sign of just how much the stronger dollar and weaknesses abroad have dampened international demand and overall sentiment. Read More

Factory Orders Fell 2.9 Percent in December

By | Economy, Shopfloor Economics | No Comments

The Census Bureau said that new factory orders fell 2.9 percent in December, declining for the fourth time in the past five months. New manufactured goods orders decreased from $470.0 billion in November to $456.5 billion in December, its lowest level since June 2011. As such, these data continue to reflect a disappointing pace of demand for manufactured products in light of recent economic slowness globally. On a year-over-year basis, new orders have declined by 3.9 percent, down from $474.9.0 billion in December 2014. Read More

ism

ISM: Manufacturing Sentiment Negative for the Fourth Straight Month

By | Economy, General, Shopfloor Economics | No Comments

The Institute for Supply Management (ISM) said that manufacturing sentiment remained somewhat negative in January. The purchasing managers’ index for the sector edged marginally higher, up from 48.0 in December to 48.2 in January. It was the fourth straight month with the headline PMI under 50, which would suggest contracting sentiment among manufacturers over that time frame. This mainly reflected deteriorating employment (down from 48.0 to 45.9) and inventories (unchanged at 43.5), with the decline in hiring at its lowest level since June 2009, the last official month of the Great Recession. Indeed, manufacturers continue to worry about the impact of the global slowdown as we start the new year. This can be seen in export growth (down from 51.0 to 47.0). The exports index has contracted in seven of the past eight months on the strong dollar and soft growth abroad. Read More