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Dallas Fed Manufacturing: Continued Strong Gains

February 27, 2017
Bottom Line: Bottom Line: The Dallas Fed's survey of manufacturing activity of Texas-based rose sharply in February for the 4th straight month. On an ISM-weighted basis, the index expanded, indicating that the details were just as positive relative to the headline figure. Six-month outlooks retreated modestly after hitting their highest level in 5 years and nearly reaching post-crisis highs in January.

The Dallas Fed Index ROSE by 2.4 points in February to 24.5%, compared with market expectations for a decline to 19.4%. This index is in positive territory and suggests that manufacturing activity in the Texas region expanded sharply. On an ISM-weighted basis, the index expanded, indicating that the details were just as positive relative to the headline figure.

Production increased sharply by 16.7%. New Orders climbed moderately by 11.6%. Shipments increased moderately by 12.2%. Unfilled Orders rose slightly while Inventories climbed.

Employment increased sharply by 9.6% while Average Workweek rose. This portends better factory job creation from Texas in the upcoming February payroll employment report.

Prices Paid increased slightly. The 6-Month Outlook deteriorated.