Friday, December 18, 2015

Kansas City Fed: Regional Manufacturing Activity "declined moderately" in December

by Bill McBride on 12/18/2015 11:02:00 AM

From the Kansas City Fed: Tenth District Manufacturing Activity Declined Moderately

The Federal Reserve Bank of Kansas City released the December Manufacturing Survey today. According to Chad Wilkerson, vice president and economist at the Federal Reserve Bank of Kansas City, the survey revealed that Tenth District manufacturing activity declined moderately, although expectations for future activity remained solid.

“After two months of mostly steady activity, regional factories pulled back again in December,” said Wilkerson. “The weakest activity was in energy-concentrated states.”
...
Tenth District manufacturing activity declined moderately in December, reversing gains from the last several months, while producers’ expectations for future activity remained solid. Most price indexes continued to ease further.

The month-over-month composite index was -9 in December, down from 1 in November and -1 in October
...
The employment index dropped from -8 to -14, and the capital expenditures index posted its lowest level since August 2010. ...

Future factory indexes were mixed, but remained at generally solid levels. The future composite index was basically unchanged at 7, while the future production, shipments, and new orders for exports indexes increased modestly.
emphasis added
The Kansas City region has been hit hard by lower oil prices and the strong dollar.  Contraction in December was probably due to the recent decline in oil prices.