Manufacturing activity in the Federal Reserve Bank of Kansas City's region "declined slightly in October, and producers' expectations for future activity fell considerably but remained slightly positive," according to the bank's monthly manufacturing survey, released Thursday.

"We saw factories pull back this month for the first time in quite a while, which many firms attributed to the impact of the uncertain political and fiscal situation on customers' willingness to order," said Chad Wilkerson, vice president and economist at the Federal Reserve Bank of Kansas City. "Expectations also weakened considerably for production and employment but, encouragingly, factories' capital spending plans for early next year remained largely intact."

The composite index decreased to negative 4 in October from positive 2 in September, while the production index slipped to negative 6 from negative 4, volume of shipments climbed to negative 6 from negative 8, and the volume of new orders index declined to negative 11 from negative 2, and the backlog of orders index declined to negative 15 from negative 7. The new orders for exports index widened to negative 7 from negative 4, and the supplier delivery time index slid to 3 from 8.

The number of employees index dropped to negative 7 from positive 1, while the average employee workweek index narrowed to negative 11 from negative 13. The prices received for finished product index rose to 8 from 5, while the prices paid for raw materials index decreased to 27 from 30.

As for the inventories indexes, materials slumped to 2 from 7, while the finished goods held at 3.

In comparison to the same month a year ago, the composite index remained at 11, the production index grew to 17 from 12. The shipments index gained to 22 from 16, while the volume of new orders rose to 10 from 6, and the backlog of orders index reversed to positive 1 from negative 4. The new orders for exports index narrowed to negative 2 from negative 4, and the supplier delivery time index increased to 10 from 7.

The number of employees index slipped to 12 from 17, while the average employee workweek index fell to negative 2 from positive 5. The prices received for finished product index slid to 30 from 35 and the prices paid for raw materials held at 60. The capital expenditures index climbed to 18 from 17.

As for the inventories indexes, materials slumped to 5 from 11, while the finished goods index dropped to 10 from 12.

In projections for six months from now, the composite index fell to 3 from 16, the production index dropped to 9 from 29. The shipments plunged to 10 from 31, while new orders sank to 8 from 24, and the backlog of orders index fell to negative 2 from positive 20. The new orders for exports index slid to negative 1 from positive 3, and the supplier delivery time index decreased to 1 from 5.

The number of employees index fell to 4 from 16, while the average employee workweek index reversed to negative 3 from positive 4. The prices received for finished product index slipped to 23 from 29, and the prices paid for raw materials rose to 53 from 49. The capital expenditures index was at 16, up from 11 the prior month.

As for the inventories indexes, materials fell to negative 5 from positive 9, while the finished goods index declined to negative 8 from positive 6.

The Tenth Federal Reserve District includes Kansas, Colorado, Nebraska, Oklahoma, Wyoming, northern New Mexico and western Missouri.

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