Manufacturing Activity In Central U.S. Unchanged In August
Manufacturing activity in the central U.S. was unchanged in August from the previous month, while expectations for future activity improved a little. The Federal Reserve Bank of Kansas City said on August 25 that the Tenth District manufacturing survey’s composite index was 0 in August. Any reading below zero suggests activity contracted from the previous month.
Economists polled by The Wall Street Journal had expected the index to show a contraction at minus 9. The reading reverses contractions in previous months, painting a slightly brighter picture for the region’s manufacturing activity.
The Kansas City Fed survey gauges manufacturing activity in the western third of Missouri, all of Kansas, Colorado, Nebraska,
Oklahoma and Wyoming, and the northern half of New Mexico. The production index boosted the overall indicator, climbing
to 12 from minus 20 the previous month. The shipments index rose to 1, while the new orders index contracted at a slower
rate of minus 3.
“Regional factory activity was basically flat in August,” said Chad Wilkerson, senior vice president at the Federal Reserve Bank of Kansas City. “Firms also reported another decline in finished product prices but anticipate output prices to rise in coming months,” he said.
The Firms’ short-term outlook was slightly better. The future composite index--which gauges the outlook for the next six
months--rose to 2 from minus 2 the previous month, when it remained at its lowest level since April 2020.
“Obviously at a macro level inflation is way down, but in our little corner of the world it is still a huge threat,” said one
respondent to the survey. “Commodities in general are just not as predictable as they used to be.”
Source: Morningstar, 08.24.2023
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