Manufacturing activity in the Federal Reserve Bank of Kansas City's region "continued at a solid pace, and optimism remained high" in December, according to the bank's monthly manufacturing survey, released Friday.
"Factories in our region remain upbeat about hiring and capital spending as we head into 2018, following strong growth in recent months," said Chad Wilkerson, vice president and economist at the Federal Reserve Bank of Kansas City.
The composite index declined to 14 in December from 16 in November, while the production index climbed to 21 from 15, volume of shipments fell to 8 from 20, the volume of new orders index declined to 7 from 22, and the backlog of orders index dropped to 6 from 12. The new orders for exports index reversed to positive 4 from negative 2 and the supplier delivery time index doubled to 16 from 8.
The number of employees index gained to 19 from 16, while the average employee workweek index rose to 10 from 7. The prices received for finished product index climbed to 15 from 12, while the prices paid for raw materials index slipped to 21 from 24.
As for the inventories indexes, materials decreased to 9 from 22, while the finished goods fell to negative 11 from positive 2.
In projections for six months from now, the composite index slipped to 22 from 27, and the production index fell to 29 from 40. The shipments declined to 28 from 37, while new orders decreased to 27 from 31, and the backlog of orders index dropped to 16 from 28. The new orders for exports index rose to 9 from 7, and the supplier delivery time index crept to 17 from 16.
The number of employees index was at 33, off from 35 last month, while the average employee workweek index slipped to 14 from 15. The prices received for finished product index slid to 33 from 37, and the prices paid for raw materials fell to 51 from 59. The capital expenditures index was at 19, after a 20 reading the prior month.
As for the inventories indexes, materials dropped to 6 from 13, while the finished goods index increased to 12 from 7.
The Tenth Federal Reserve District includes Kansas, Colorado, Nebraska, Oklahoma, Wyoming, northern New Mexico and western Missouri.