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Economy in Brief
UK Consumer Sentiment Hits Lowest Reading since 1996
(when the GFK survey began; also lowest reading 'ever')
Of these 13 readings eight of them declined on the month in May three of them improved and two of them were unchanged...
U.S. Existing Home Sales Continue to Fall in April as Houses Become Less Affordable
The combination of soaring home prices across the nation and rising interest rates is making homes less affordable...
U.S. Index of Leading Indicators Fell in April
Five of the index's components fell in April, one was unchanged and four increased...
U.S. Unemployment Claims Rose in the Latest Week
The state insured rates of unemployment in regular programs vary widely...
CBI Gauge in the UK Continues to Be Upbeat
The global economy has a lot of challenges...
Viewpoints
Commentaries are the opinions of the author and do not reflect the views of Haver Analytics.
Profits and Margins Plunge In Q1: Expect More Margin Contraction As Fed Squeezes Inflation
The Many Links of Inflation Cycle: Hard Landing Is Needed to Crack Them
Peak Inflation and Fed Policy: A Relationship which Should Worry the Fed and Scare Investors
Why Have the Yields on TIPS Been Negative in the Past Two Years?
by Tom Moeller March 24, 2022
• Component improvement is mostly positive.
• Expected conditions rise.
• Pricing power recoups February decline.
The Federal Reserve Bank of Kansas City reported that its manufacturing sector business activity index rose to 37 during March after rising to 29 in February. It was a record for the series which dates back to July 2001. The ISM-Adjusted Index (NSA) rose to 68.9 this month, also a record.
The new orders measure rose to 33, the highest level since May of last year. An increased 46% of respondents reported order gains and a greatly lessened 9% reported declines. The shipments reading surged to a record 46, up from a low of five in January. The production measure rose to 46, also a series high. The employment measure declined to 18, its lowest level in three months.
The supplier delivery times and order backlog readings also rose to 55 and 29, respectively. The supplier delivery times index matched the record reached in November.
Inflation pressures intensified this month. The prices received index for finished products increased to 51, the highest level since August. A slightly lessened 51% of respondents reported higher prices received while a marginally lessened three percent reported price declines. The overall reading remained below the record level of 57 in August. The raw materials index rose sharply to 81 but remained below the record of 88 last May.
The expectations reading for six months ahead surged to a record 41 from 38 in February. The orders, production and shipments measures rose but employment fell. Expected pricing power surged to a record.
The latest survey was conducted in the five-day period from March 16-to-21 and included 87 responses from plants in Colorado, Kansas, Nebraska, Oklahoma, Wyoming, northern New Mexico and western Missouri.
The series dates back to July 2001. The diffusion indexes are calculated as the percentage of total respondents reporting increases minus the percentage reporting declines. Data for the Kansas City Fed Survey can be found in Haver's SURVEYS database.
Kansas City Federal Reserve Manufacturing Survey (SA) | Mar | Feb | Jan | Mar'21 | 2021 | 2020 | 2019 |
---|---|---|---|---|---|---|---|
Conditions Versus One Month Ago (% Balance) | 37 | 29 | 24 | 29 | 26 | 0 | 0 |
ISM-Adjusted Composite Index (NSA) | 68.9 | 62.0 | 59.0 | 65.4 | 62.7 | 50.1 | 50.0 |
New Orders Volume | 33 | 32 | 14 | 44 | 23 | 1 | -4 |
Number of Employees | 18 | 26 | 24 | 21 | 24 | -4 | -1 |
Production | 46 | 31 | 20 | 28 | 25 | 0 | 2 |
Prices Received for Finished Product | 51 | 47 | 49 | 37 | 43 | 2 | 7 |
Expected Conditions in Six Months | 41 | 38 | 37 | 37 | 33 | 10 | 12 |
New Orders Volume | 40 | 36 | 30 | 40 | 37 | 12 | 17 |
Number of Employees | 46 | 52 | 57 | 44 | 41 | 11 | 15 |
Production | 61 | 57 | 44 | 50 | 45 | 14 | 18 |
Prices Received for Finished Product | 75 | 70 | 67 | 51 | 52 | 16 | 26 |