Manufacturing activity in the Federal Reserve Bank of Kansas City's region "expanded at a faster pace and expectations remained solid" in August, according to the bank's monthly manufacturing survey, released Thursday.
"Factories reported acceleration in activity in August to the fastest pace since March" said Chad Wilkerson, vice president and economist at the Federal Reserve Bank of Kansas City. "Many firms also reported plans to raise finished goods prices in coming months."
The composite index grew to 16 in August from 8 in July, while the production index soared to 22 from 4, volume of shipments gained to positive 23 from negative 2, the volume of new orders index gained to 25 from 10, and the backlog of orders index surged to positive 13 from negative 1. The new orders for exports index reversed to positive 4 from negative 3 and the supplier delivery time index remained at 10.
The number of employees index dipped to 14 from 15, while the average employee workweek index increased to 9 from 1. The prices received for finished product index rose to 8 from 5, while the prices paid for raw materials index grew to 21 from 18.
As for the inventories indexes, materials held at 10, while the finished goods dropped to 2 from 8.
In projections for six months from now, the composite index dipped to 23 from 24, and the production index decreased to 27 from 26. The shipments index fell to 29 from 33, while new orders climbed to 39 from 26, and the backlog of orders index soared to 19 from 10. The new orders for exports index rose to 4 from 1, and the supplier delivery time index decreased to 14 from 15.
The number of employees index was at 26, unchanged from last month, while the average employee workweek index dropped to 1 from 18. The prices received for finished product index increased to 34 from 13, and the prices paid for raw materials inched up to 39 from 37. The capital expenditures index was at 18, after a 17 reading the prior month.
As for the inventories indexes, materials fell to negative 2 from positive 4, while the finished goods index declined to negative 6 from positive 18.
The Tenth Federal Reserve District includes Kansas, Colorado, Nebraska, Oklahoma, Wyoming, northern New Mexico and western Missouri.