Texas Manufacturing Activity Continues to Grow, Says Dallas Fed Survey
For Immediate Release: March 25, 2019
DALLAS—Texas factory activity continued to expand in March, according to the Federal Reserve Bank of Dallas’ Texas Manufacturing Outlook Survey.
The production index, a key measure of state manufacturing conditions, held fairly steady at 11.5. The general business activity index remained positive but fell five points to 8.3. Positive readings in the survey generally indicate expansion of factory activity, while readings below zero generally indicate contraction.
“The Texas manufacturing sector continued to expand at an average pace in March, a downshift from the more robust growth seen last year,” said Emily Kerr, Dallas Fed senior business economist.
Here are some additional takeaways from the March manufacturing report:
Demand growth eased. The new orders index fell from 6.9 to 2.4, and the growth rate of orders index slipped into negative territory for the first time since December 2016.
Outlooks were a bit less optimistic, though still positive. The company outlook index stayed in positive territory but fell from 14.2 to 6.0. The index measuring uncertainty regarding companies’ outlooks was largely unchanged at a 10-month low of 3.4.
Labor market indicators remained strong. The employment index held steady at 13.1, a reading well above average. The hours worked index came in at 4.6, up slightly from February.
Upward pressure on prices and wages continued. The raw materials and finished goods prices indexes held fairly steady at 20.4 and 6.9, respectively. Twenty-seven percent of firms noted higher input costs this month—about twice the share noting higher selling prices. The wages and benefits index remained elevated at 30.1.
Manufacturers remained positive about future business conditions. The index of future general business activity inched up two points to 19.7, while the index of future company outlook fell nine points to 17.5. Most other indexes for future manufacturing activity pushed further into positive territory this month.
Federal Reserve Bank of Dallas
Phone: (214) 922-6748