Dallas Fed Manufacturing Index Turns Positive at 0.4 as Raw Materials Prices Hit 8-Month High
Updated
Updated · investinglive.com · May 26
Dallas Fed Manufacturing Index Turns Positive at 0.4 as Raw Materials Prices Hit 8-Month High
7 articles · Updated · investinglive.com · May 26
May's Dallas Fed general business activity index rose to 0.4 from -2.3, moving back into positive territory but still signaling little change in overall manufacturing conditions.
Underlying factory gauges weakened: production fell 10 points to 9.4, new orders slipped to 6.4, shipments dropped to 7.4 and capacity utilization sank 15 points to 5.2.
Price signals diverged as the raw materials index jumped 6 points to 42.7—its highest in eight months—while finished goods prices fell 9 points to 18.9 and wages held near steady at 23.6.
Labor and sentiment stayed soft, with the employment index flat at 0.2, hours worked down to 1.8, the company outlook index easing to 0.3 and uncertainty remaining elevated at 19.2 versus a 16.9 long-run average.
Six-month expectations remained comparatively firm, with future production at 36.8 and future general business activity steady at 14.3, suggesting manufacturers still expect stronger activity ahead.
Why are manufacturers so optimistic for the future when current business activity is showing clear signs of a slowdown?
With Nasdaq at a record high, why do weak manufacturing and a falling Dow suggest a hidden economic risk?
With raw material costs surging, why are manufacturers being forced to cut prices on their finished goods?