| Actual | Previous | |
|---|---|---|
| Level | -3 | -13 |
Highlights
Kansas City Fed district manufacturing activity contracted again in August from July but the pace of decline lessened, paced by an uptick in current production. The Kansas City Fed composite index of current manufacturing business conditions edged up to minus 3 in August from minus 13 in July and minus 8 in June.
The composite index of six-month expectations for business conditions improved slightly to 8 in August versus 5 in July and 7 in June.
The current new orders index came in at minus 12 in August versus minus 21 in July and minus 13 in June. Production actually expanded as it improved to 6 in August from minus 12 in July and minus 11 in June. The number of employees index was at minus 7 in August versus minus 12 in July and minus 11 in June.
Prices paid registered 18 in August, 17 in July, and 9 in June. Prices received were at 6 in August versus 0 in July and 3 in June.
The composite index of six-month expectations for business conditions improved slightly to 8 in August versus 5 in July and 7 in June.
The current new orders index came in at minus 12 in August versus minus 21 in July and minus 13 in June. Production actually expanded as it improved to 6 in August from minus 12 in July and minus 11 in June. The number of employees index was at minus 7 in August versus minus 12 in July and minus 11 in June.
Prices paid registered 18 in August, 17 in July, and 9 in June. Prices received were at 6 in August versus 0 in July and 3 in June.
Definition
The Kansas City Fed index offers a monthly assessment of change in the region's manufacturing sector. Positive readings indicate monthly growth and negative readings monthly contraction. Readings at zero indicate no change. The headline number is the composite index, an average of the production, new orders, employment, delivery time, and raw materials inventory indexes.
Description
Investors track economic data like the Kansas City Survey of Manufacturers to understand the economic backdrop for the various markets. The stock market likes to see healthy economic growth because that translates to higher corporate profits. The bond market prefers a moderate growth environment that will not generate inflationary pressures. The survey gives a detailed look at Tenth District's manufacturing sector, how busy it is and where it is headed. Some of the survey indexes also provide insight on inflation pressures—including prices paid, prices received, wages & benefits, and capacity utilization. The equity market is also sensitive to this report because it is an early clue on the nation's manufacturing sector, reported in advance of the ISM manufacturing index and often in advance of the NAPM-Chicago index.
