Global| Dec 18 2015Kansas City Federal Reserve Factory Sector Retraces Earlier Improvement
by:Tom Moeller
|in:Economy in Brief
Summary
The Federal Reserve Bank of Kansas City reported that manufacturing sector business activity in the region deteriorated sharply during December, and completely reversed the improvement during the prior three months. The Composite [...]
The Federal Reserve Bank of Kansas City reported that manufacturing sector business activity in the region deteriorated sharply during December, and completely reversed the improvement during the prior three months. The Composite Index of 10th District factory sector activity fell to -9, the weakest figure since August, although the quarterly measures continued strengthening after a Q2 low. Deterioration in the monthly readings was broad-based, notably for new orders and employment. The shipments and inventories figures also deteriorated markedly this month, as did inventories. New exports weakened m/m and pricing power remained negative to roughly the same degree throughout the year.
The Composite Index reflecting 6-month expectations remained sharply improved since its June low. Strengthening was notable for shipments and new orders. The employment measure rose, but to a lesser extent. Expected production, capital expenditures and exports also gained but expectations for finished goods prices remained depressed.
The diffusion indexes are calculated as the percentage of total respondents reporting increases minus the percentage reporting declines. The survey included 94 responses from plants in Colorado, Kansas, Nebraska, Oklahoma, Wyoming and northern New Mexico. Data for the Kansas City Fed Survey can be found in Haver's SURVEYS database.
| Kansas City Federal Reserve Manufacturing Survey (SA) | Dec | Nov | Oct | Dec '14 | 2015 | 2014 | 2013 |
|---|---|---|---|---|---|---|---|
| Conditions Versus One Month Ago (% Balance) | -9 | 1 | -1 | 8 | -5 | 6 | 0 |
| New Orders Volume | -5 | 5 | 7 | 14 | -7 | 8 | 1 |
| Number of Employees | -17 | -8 | -3 | 8 | -10 | 5 | -2 |
| Prices Received for Finished Product | -7 | -9 | -3 | 1 | -5 | 5 | 4 |
| Expected Conditions in Six Months | 7 | 8 | -1 | 19 | 4 | 17 | 10 |
| New Orders Volume | 16 | 18 | 7 | 23 | 11 | 26 | 18 |
| Number of Employees | 7 | 13 | 6 | 30 | 6 | 18 | 9 |
| Prices Received for Finished Product | -1 | 2 | 8 | 28 | 9 | 26 | 24 |
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
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