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Highlights
Tenth District manufacturing activity eased slightly in December, but expectations for future months improved somewhat. The composite index slipped to minus 4 in December, down from plus 4 in November and 8 in October, and the first negative reading since December 2009. Manufacturing activity slowed in both durable and nondurable goods-producing plants, particularly for food and fabricated metal products. The production and shipments indexes moved into negative territory, and the new orders and order backlog indexes fell further. The employment index dropped to its lowest level since mid-2009, and the new orders for exports index edged down. Both inventory indexes decreased considerably.
Most future factory indexes improved from the previous month, and remained at relatively solid levels. The future composite index inched higher from 12 to 14, while the future production index was unchanged at 22.
The raw materials price index climbed higher from 12 to 28, and the finished goods price index also edged up slightly. The future raw materials price index eased from 58 to 55, and the future finished goods price index moved lower, indicating slightly fewer firms plan to pass recent cost increases through to customers.
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Definition
The monthly Survey of Manufacturers provides information on current manufacturing activity in the Tenth District. The accumulated results also help trace longer term trends. The survey monitors manufacturing plants selected according to geographic distribution, industry mix, and size. Survey results reveal changes in several indicators of manufacturing activity, including production and shipments, and identify changes in prices of raw materials and finished products. Answers cover changes over the previous month, changes over the past twelve months, and expectations for activity six months into the future. The breakeven point for each index is zero with positive numbers indicating growth and negative numbers reflecting decline. (Federal Reserve Bank of Kansas City)
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