Manufacturing activity in the Federal Reserve Bank of Kansas City's region "expanded solidly, and producers' expectations for future factory activity remained at healthy levels" in May, according to the bank's monthly manufacturing survey, released Thursday.
"This was the third straight month of solid growth at factories in the region, following some weather-related weakness in previous months," said Chad Wilkerson, vice president and economist at the Federal Reserve Bank of Kansas City. "More factories than in recent surveys were also able to raise selling prices."
The composite index climbed to 10 in May from 7 in April, while the production index crept to 14 from 12, volume of shipments slipped to 5 from 14, and the volume of new orders index grew to 11 from 9, and the backlog of orders index dipped to zero from 4. The new orders for exports index fell to negative 3 from zero, and the supplier delivery time index slid to 5 from 11.
The number of employees index grew to 10 from 3, while the average employee workweek index rose to 14 from 6. The prices received for finished product index jumped to 14 from 2, while the prices paid for raw materials index increased to 28 from 21.
As for the inventories indexes, materials surged to positive 11 from negative 1, while the finished goods rose to 4 from 2.
In projections for six months from now, the composite index fell to 13 from 21, and the production index slumped to 18 from 38. The shipments index dropped to 24 from 37, while new orders slid to 22 from 33, and the backlog of orders index declined to 9 from 20. The new orders for exports index decreased to 4 from 7, and the supplier delivery time index dipped to 10 from 11.
The number of employees index was at 16, down from 22, while the average employee workweek index decreased to 10 from 12. The prices received for finished product index grew to 32 from 31, and the prices paid for raw materials rose to 53 from 46. The capital expenditures index was at 19, off from 21 the prior month.
As for the inventories indexes, materials held at 1, while the finished goods index climbed to 2 from zero.
The Tenth Federal Reserve District includes Kansas, Colorado, Nebraska, Oklahoma, Wyoming, northern New Mexico and western Missouri.
