Dallas Fed June manufacturing survey -23.2 vs -29.1 prior

• Prior was -29.1
• Output -4.2 vs -1.3 prior
• New orders -16.6 vs -16.1 prior
• Prices paid for raw materials +1.4 vs +13.8 prior
• Prices paid for finished goods -1.9 vs +0.4 prior
• Capex +0.3 vs -3.7 prior
• Employment +2.2 vs +9.6 prior
• Company outlook -10.7 vs -22.3 prior

Comments in the report:

Chemical manufacturing

• We expect slower activity in the coming months as customer destocking continues as their business slows. We expect to hold onto as many trained employees as we can, expecting a return to growth in 2024.
• Inflation Inflation Inflation is defined as a quantitative measure of the rate in which the average price level of goods and services in an economy or country increases over a period of time. It is the rise in the general level of prices where a given currency effectively buys less than it did in prior periods.In terms of assessing the strength or currencies, and by extension foreign exchange, inflation or measures of it are extremely influential. Inflation stems from the overall creation of money. This money is m Inflation is defined as a quantitative measure of the rate in which the average price level of goods and services in an economy or country increases over a period of time. It is the rise in the general level of prices where a given currency effectively buys less than it did in prior periods.In terms of assessing the strength or currencies, and by extension foreign exchange, inflation or measures of it are extremely influential. Inflation stems from the overall creation of money. This money is m Read this Term continues to take a toll on employee salaries and benefits. Costs of materials, parts, external labor, and shipping continue to increase as suppliers mitigate the loss of volumes in price to sustain or increase profit levels. Customers continue to give mixed messages around supply and demand as consumer spending is not consistent. Customers are just now working off surplus inventories from 2022; as anticipated, purchases occurred due to supply/demand woes, war impact and high inflation costs.

Computer and electronic product manufacturing

• We continue to struggle to find qualified staff. We intend to hire more people and embark on a significant capital improvement project (including new building, new manufacturing equipment) so that we have capacity available as soon as the economy starts to recover after the recession that everyone is predicting.
• We are still seeing some long lead times, currently with the aluminum industry.
• We are starting to see a major shift in industrial production and a lack of confidence.

Fabricated metal product manufacturing

• Supply constraints improved versus the prior year, but there are still some ongoing challenges.

Food manufacturing

• We are definitely slower from a production perspective. We expect production to pick up a little later in the summer in preparation of fourth-quarter sales.
• Stagflation Stagflation Stagflation is an economic environment characterised by slowing economic growth and rising inflation. In fact, the term “stagflation” is derived from the words “stagnation” and “inflation”. Stagflation as Real-Life ExampleThe 1970s is a famous stagflationary period and although there isn’t a single correct answer, economists identified two possible explanations for why it occurred. The first reason can be a supply shock like rapid increase in oil prices. This situation also increases production Stagflation is an economic environment characterised by slowing economic growth and rising inflation. In fact, the term “stagflation” is derived from the words “stagnation” and “inflation”. Stagflation as Real-Life ExampleThe 1970s is a famous stagflationary period and although there isn’t a single correct answer, economists identified two possible explanations for why it occurred. The first reason can be a supply shock like rapid increase in oil prices. This situation also increases production Read this Term. Political incompetence is creating an unstable business environment.

Machinery manufacturing

• We’re investing now with new equipment that should increase our competitiveness even in a potentially shrinking market six months from now. The last 12 months have provided the wherewithal to be able to make such investment. We’ll see how it shakes out.
• We are living hand to mouth. The surge in orders could easily stop as quickly as it started. We’re month to month.
• Business has slowed down significantly over the last few months and is now holding steady at a relatively low level.

Nonmetallic mineral product manufacturing

• The interest rate is too high and is eating away our profits.

Paper manufacturing

• Orders are cooling off a little from and already-reduced level. Our industry cooled off a few quarters ago, and now we are feeling the same thing.

Plastics and rubber products manufacturing

• We service retailers. They are tentative; we are wary.

Primary metal manufacturing

• Section 142 tariffs raise our costs, rendering us uncompetitive with foreign competitors who don’t pay that cost.
• Incoming orders are off substantially, especially in the residential building and construction markets we produce raw material for. Also, the percentage of imports of aluminum extrusions is at its highest level in several years, going back to when China was subsidizing their aluminum extrusion industry for shipments to the U.S. We are also being affected severely by Mexico shipping extrusions to the U.S. without having to pay Section 232 tariffs. Our industry is at a critical state at this point.

Printing and related support activities

• We have started to get very busy with a large job that we knew was coming and has now arrived. Because of this and a couple of other nice large jobs we have landed, we will be busy during the summer and into the fall. It’s a good thing because our regular business from regular customers is in the ditch right now. I'm hearing from many others in our industry that it’s slow times for them, so we are very fortunate to have the work we have.

Textile product mills

• June has been much stronger than anticipated across all channels. We think our consumer (which tends to be high end and high income) is feeling more confident about inflation and the future economic outlook and is back to spending.