NEW YORK - Texas factory activity, as measured by the production index, continued to expand, at a slower pace in April than in March, according to the monthly business activity survey conducted by the Federal Reserve Bank of Dallas, released Monday.

The general business activity index decreased to negative 3.4 in April from positive 10.8 in March.

The production index dipped to 5.6 from 11.1, while capacity use decreased to 1.4 from 12.3, the Fed reported. Volume of new orders slipped to negative 1.0 from negative 0.3, while growth rate of orders index declined to negative 2.6 from negative 0.8.

Unfilled orders fell to negative 8.3 from positive 0.3 in the prior survey, while the volume of shipments slumped to negative 0.8 from positive 8.6, and delivery times slipped to negative 1.1 from positive 6.8. The materials inventory index grew to positive 7.3 from negative 0.3, the finished goods inventory improved to negative 5.6 from negative 8.0. Prices paid for raw materials dropped to 21.2 from 27.7, while prices received for finished goods sank to negative 5.4 from negative 1.3. Wages and benefits slid to 15.2 from 21.0, while the employment index fell to 11.8 from 21.7, and the hours worked index fell to negative 4.6 from positive 2.9, and the capital expenditures index decreased to 6.1 from 6.3.

As for future outlook (six months from now), the general business conditions index slid to 15.7 from 19.1 last month, the production index decreased to 38.5 from 44.0, while capacity use slipped to 34.9 from 41.8, the Fed reported. Volume of new orders fell to 31.4 from 44.0, while growth rate of orders index decreased to 21.1 from 37.2.

Unfilled orders sank to 4.6 from 15.1, while the volume of shipments declined to 34.7 from 42.8, and delivery times reversed to negative 2.3 from positive 1.2. Materials inventories fell to 5.8 from 11.8, and the finished goods inventory declined to negative 2.3 from positive 7.0.

Prices paid for raw materials decreased to 40.2 from 55.8, while prices received for finished goods dropped to 16.1 from 29.1. Wages and benefits slid to 36.4 from 40.3, the employment index plunged to 19.8 from 36.9, while the hours worked index grew to 9.8 from 9.6, and the capital expenditures index dropped to 21.0 from 25.6.

The Texas Manufacturing Outlook Survey is a monthly anecdotal survey of manufacturers in Texas. Roughly 80 manufacturers regularly participate in the Dallas Fed survey, which began collecting data in May 2004.

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