Monday, January 30, 2017

Dallas Fed: Regional Manufacturing Activity "Continues to Expand" in January

by Bill McBride on 1/30/2017 02:34:00 PM

From the Dallas Fed: Texas Manufacturing Activity Continues to Expand

Texas factory activity increased for the seventh consecutive month in January, according to business executives responding to the Texas Manufacturing Outlook Survey. The production index, a key measure of state manufacturing conditions, edged down but remained positive at 11.9, suggesting output growth continued but at a slightly slower pace this month. ...
...
The general business activity index posted a fourth consecutive positive reading and moved up to 22.1, its highest reading since April 2010.
...
Labor market measures indicated employment gains and longer workweeks. The employment index bounced back to 6.1 after dipping into negative territory last month. Twenty-three percent of firms noted net hiring, compared with 17 percent noting net layoffs. The hours worked index moved up to 9.1, its strongest reading since the end of 2015. ...
emphasis added
This was the last of the regional Fed surveys for January.

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

It seems likely the ISM manufacturing index will show stronger expansion in January, and the consensus is for a reading of 55.0.