Thursday, April 28, 2016

Kansas City Fed: Regional Manufacturing Activity "declined modestly" in April

by Bill McBride on 4/28/2016 11:00:00 AM

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

The Federal Reserve Bank of Kansas City released the April 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 modestly.

Factories reported a modest decline in activity in April, but expectations for future activity increased to their highest reading of the year”, said Wilkerson.
...
Tenth District manufacturing activity continued to decline modestly, while producers’ expectations for future activity improved considerably. Most price indexes moved slightly higher in April, but remained at low levels.

The month-over-month composite index was -4 in April, up from -6 in March and -12 in February ...
emphasis added
The Kansas City region was hit hard by lower oil prices and the stronger dollar, but the impact is fading.

This was the last of the regional Fed surveys for April.

Here is a graph comparing the regional Fed surveys and the ISM manufacturing index:

Fed Manufacturing Surveys and ISM PMI Click on graph for larger image.

The New York and Philly Fed surveys are averaged together (yellow, through April), and five Fed surveys are averaged (blue, through April) including New York, Philly, Richmond, Dallas and Kansas City. The Institute for Supply Management (ISM) PMI (red) is through March (right axis).

It seems likely the ISM manufacturing index will show slow expansion again in April.