By Ed Frankl
Factory activity in the central U.S. declined at a quicker pace in March, as demand continues to struggle in the manufacturing sector.
The Federal Reserve Bank of Kansas City said Thursday that the Tenth District manufacturing survey's composite index was minus seven in March, dipping from minus four in February.
The reading was weaker than expectations of the index to rise to minus 3, according to a consensus of economists polled by The Wall Street Journal. Any reading below zero suggests activity contracted from the previous month.
The Kansas City Fed survey gauges manufacturing activity in the western third of Missouri, all of Kansas, Colorado, Nebraska, Oklahoma and Wyoming, and the northern half of New Mexico.
Production and volume of shipments ticked down, while both new orders and backlogs fell sharply, the Kansas City Fed said. Primary metal, electrical equipment, and paper manufacturing drove the decrease in the index, it said.
Meanwhile, prices grew at a similar rate to previous months, while employment levels continued to rise, the Kansas City Fed added.
Last year "finished with much higher bookings and shipments than 2022, but orders in the first quarter of 2024 have slowed substantially," said one respondent from the manufacturing sector.
While activity dipped further in March, expectations for future output were steady, said Chad Wilkerson, senior vice president at the Kansas City Fed.
Write to Ed Frankl at edward.frankl@wsj.com
(END) Dow Jones Newswires
03-28-24 1131ET
