Manufacturing activity in the Federal Reserve Bank of Kansas City’s region “increased further in February, and expectations also climbed higher,” according to the bank’s monthly manufacturing survey, released Thursday.

“Factories further ramped up activity in February and — despite a drop-off in export orders — were more optimistic about future output and hiring than at any time in the past year,” said Chad Wilkerson, vice president and economist at the Kansas City Fed.

The composite index increased to 13 in February from 7 in January, while the production index rose to 20 from 13, volume of shipments decreased to 8 from 13, and the volume of new orders index dipped to 8 from 9. The number of employees index grew to 11 from 9, while the average employee workweek index decreased to negative 3 from zero.

The prices received for finished product index slid to 11 from 13 and the prices paid for raw materials index decreased to 36 from 42.

In projections for six months from now, the composite index grew to 20 from 12, and the production index rose to 35 from 28. The shipments index gained to 37 from 23, while new orders surged to 34 from 18.

The capital expenditures index was at 18, down from 22 the previous month.

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