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US: Dallas Fed Manufacturing Survey
| Actual | Previous | |
| General Activity Index | 0.0 | 0.4 |
| Production Index | 4.1 | 9.4 |
Highlights
A blah showing for manufacturing activity for the Dallas Fed district as current activity is flat again in June with slower growth in new orders and production though employment picked up a little.
The Dallas Fed's general activity index comes in 0.0 in June versus 0.4 in May, minus 2.3 in April, minus 0.2 in March and positive 0.2 in February. As a 0 figure indicators flat business conditions, this number suggests no growth in June from May.
Current production falls to 4.1 in June from 9.4 in May, 19.0 in April, 6.8 in March and 12.5 in February. That 4.1 index points to a below-average rate of expansion. New orders, the leading indicator, comes in at 2.3 in June versus 6.4 in May, 9.9 in April, 6.1 in March and 11.1 in February.
Employment perks up to 13.9 in June from 0.2 in May, minus 0.9 in April, minus 1.0 in March, and 7.5 in February. Capex improves to 11.4 from 6.0 in May, 3.1 in April, 5.7 in March, minus 0.4 in February.
Definition
The Dallas Fed Manufacturing Survey tracks factory activity in Texas on a monthly basis. Firms are asked whether output, employment, orders, prices and other indicators increased, decreased or remained unchanged over the previous month. Responses are aggregated into balance indexes where positive values generally indicate growth while negative values generally indicate contraction. About 100 manufacturers regularly participate in the survey.
Description
Investors track economic data like the Dallas Fed Manufacturing Survey 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 Dallas Survey gives a detailed look at Texas' manufacturing sector, how busy it is and where it is headed. Since manufacturing is a major sector of the economy, this report can have a big influence on the markets. Some of the survey indexes also provide insight on inflation pressures -- including prices paid, prices received, wages & benefits, and capacity utilization. The Federal Reserve closely watches this report because when inflation signals are flashing, policymakers can reset the direction of interest rates. As a consequence, the bond market can be highly sensitive to this report. 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.