Manufacturing activity in the Federal Reserve Bank of Kansas City's region "contracted further in February, and factories' expectations weakened somewhat," according to the bank's monthly manufacturing survey, released Thursday.
"Factory activity fell more sharply in February than in previous months," said Chad Wilkerson, vice president and economist at the Federal Reserve Bank of Kansas City. "Some contacts cited disruptions due to bad weather, and many firms noted that possible federal spending cuts were hurting business. However, capital spending plans for later in the year improved considerably."
The composite index widened to negative 10 in February from negative 2 in January, while the production index declined to negative 11 from negative 3, volume of shipments dropped to negative 12 from negative 3, and the volume of new orders index slumped to negative 25 from negative 2, and the backlog of orders index slid to negative 18 from negative 6. The new orders for exports index narrowed to negative 1 from negative 8, and the supplier delivery time index reversed to negative 6 from positive 4.
The number of employees index rebounded to positive 2 from negative 8, while the average employee workweek index dipped to negative 14 from negative 8. The prices received for finished product index fell to 5 from 7, while the prices paid for raw materials index increased to 25 from 23.
As for the inventories indexes, materials slipped to negative 8 from negative 4, while the finished goods rose to negative 6 from negative 10.
In comparison to the same month a year ago, the composite index dipped to negative 4 from positive 1, the production index narrowed to negative 7 from negative 9. The shipments index fell to negative 5 from negative 4, while the volume of new orders slid to negative 14 from negative 7, and the backlog of orders index widened to negative 15 from negative 12. The new orders for exports index narrowed to negative 4 from negative 11, and the supplier delivery time index increased to zero from negative 1.
The number of employees index slip to 12 from 14, while the average employee workweek index fell to negative 17 from negative 11. The prices received for finished product index slid to 29 from 31 and the prices paid for raw materials jumped to 60 from 50. The capital expenditures index rebounded to positive 8 from negative 3.
As for the inventories indexes, materials slipped to negative 9 from positive 6, while the finished goods index dropped to negative 3 from zero.
In projections for six months from now, the composite index slipped to 4 from 7, and the production index slid to 12 from 15. The shipments remained at 14, while new orders fell to 15 from 19, and the backlog of orders index rose to 5 from 2 The new orders for exports index rose to 1 from zero, and the supplier delivery time index reversed to positive 1 from negative 1.
The number of employees index dipped to 2 from 3, while the average employee workweek index slipped to negative 3 from positive 3. The prices received for finished product index held at 26, and the prices paid for raw materials increased to 51 from 47. The capital expenditures index was at 18, up from 3 the prior month.
As for the inventories indexes, materials widened to negative 9 from negative 3, while the finished goods index fell to negative 13 from negative 2.
The Tenth Federal Reserve District includes Kansas, Colorado, Nebraska, Oklahoma, Wyoming, northern New Mexico and western Missouri.
