Kansas City Fed Manufacturing Tips Closer to Negative Growth

The Kansas City Federal Reserve has published its KC Fed Manufacturing Index showing that the index fell to 2.0 in the month of September. It is yet another drop in manufacturing data as the index came in up 8 in August versus 5 in July. Bloomberg had a consensus estimate of 5.0 for September, but the range was very wide at -2.0 to 9.0 from the economists.

Here are some of the additional data points:

• 6-month expectations were flat at 16 in September versus the same reading in August.
• Manufacturing production was -4 in September versus a positive 7 in August.
• Expectations production was 29 in September versus 31 in August.

The KC Fed explains this index by saying, “The accumulated results help trace longer term trends. The survey monitors manufacturing plants selected according to geographic distribution, industry mix and size. Survey results reveal changes in several indicators of manufacturing activity, including production and shipments, and identify changes in prices of raw materials and finished products.”

This is just one more bit of evidence that the slowing is down to growth which is effectively not measurable at the street level, or worse.

JON C. OGG