Manufacturing slows more in bellwether Texas

28 April 2008 18:36  [Source: ICIS news]

Manufacturing remains slowWASHINGTON (ICIS news)--Manufacturing activity remained sluggish this month in the bellwether state of Texas, the US central bank said on Monday, with business executives among chemical and other industries reporting worsening conditions.


The Federal Reserve Bank said its district office in Dallas, Texas, reported that its monthly survey of manufacturers in the state showed that producers “continued to be pessimistic in their evaluations of general business activity”.


The Dallas Fed’s index of general business conditions in the state’s manufacturing sector slid further into negative territory, falling to -23.4 from 22.7 in March.  The Fed district bank said the index has been showing negative numbers for ten months.


The health of the Texas manufacturing sector is considered a key indicator for the US industrial production economy as a whole because the state - one among the 50 US states - produces nearly 9% of all US manufactured goods.  Texas ranks second only to California in factory production and is the leading US state in exports of manufactured goods.


The state turns out nearly 20% of the nation’s petroleum and coal products, 15% of its chemicals, 13% of computer and electronics products and 10% of both machinery and non-metal mineral products such as glass, brick and cement.


The Dallas Fed said its survey indicators for production, capacity utilisation and volume of shipments all fell in April, although the measure of capital expenditures increased slightly and remains in positive territory.


In addition, the Fed branch said that pricing pressures on raw materials continued to increase in April, pushing that index to its highest level since the branch began tracking this data in 2004.


More than 70% of manufacturers in the state reported increases in raw materials prices this month compared with March, and 65% said they expect those prices to be higher in six months.

By: Joe Kamalick
+1 713 525 2653

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