Dallas Fed: Texas Manufacturing Surges in June
For immediate release: June 25, 2012
DALLAS—Texas factory activity surged in June, according to the Federal Reserve Bank of Dallas’ Texas Manufacturing Outlook Survey.
Texas produces more than 9 percent of total manufactured goods in the United States, ranking second behind California in factory production.
The production index—a key measure of state manufacturing conditions—rose from 5.5 to 15.5, posting its strongest reading in 15 months.
Positive readings in the survey generally indicate expansion of factory activity, while readings below zero generally indicate contraction.
Other measures of current manufacturing conditions also indicated strengthening activity in June. The new orders index rose to 7.9, following three readings around zero, suggesting demand finally grew after staying flat since February.
The capacity utilization index reached its highest level since early 2011.
Perceptions of broader economic conditions improved in June. The general business activity index had been negative in April and May but moved into positive territory in June.
Labor market indicators reflected stronger labor demand growth and steady workweeks. Employment grew at a faster pace in June, with the index rising further into positive territory.
Input price pressures dissipated abruptly in June, while selling prices declined and wages rose at a slower pace. The raw materials price index plummeted from 20.2 to 2.7, registering its lowest reading since mid-2009.
Despite significantly higher activity in June, expectations regarding future business conditions slipped.
The Dallas Fed conducts the Texas Manufacturing Outlook Survey monthly to obtain a timely assessment of the state’s factory activity.
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