Manufacturing activity in the Federal Reserve Bank of Kansas City's region "continued to expand modestly, and producers remained generally positive about future months," according to the bank's monthly manufacturing survey, released Thursday.
"Factory activity in our region continues to be buoyed by strong growth among agriculture and energy-related manufacturers," said Chad Wilkerson, vice president at the Kansas City Fed. "New orders accelerated at these firms in August even as some other firms experienced softness. But hiring and capital spending plans remain fairly solid across broader categories of producers." Though price indexes eased this month, firms still planned to raise selling prices, he added.
The composite index remained 3 in August, while the production index reversed to negative 2 from positive 2. Volume of shipments fell to negative 2 from zero, the volume of new orders index improved to positive 1 from negative 5, and the backlog of orders index narrowed to negative 10 from negative 19.
The number of employees index rose to 8 from 4, while the average employee workweek index slid to negative 5 from negative 2. The prices received for finished product index dropped to 4 from 14, and the prices paid for raw materials index decreased to 28 from 39.
In projections for six months from now, the composite index decreased to 9 from 14 and the production index slipped to 12 from 21. The shipments index slipped to 17 from 27, while new orders remained 20, and the backlog of orders index decreased to negative 1 from positive 9.
The number of employees index fell to 12 from 17, while the average employee workweek index held at negative 1. The prices received for finished product index decreased to 20 from 25, and the prices paid for raw materials slumped to 53 from 60. The capital expenditures index was at 18, up from 16 the prior month.
