Texas manufacturers in February continued to see growing production and have positive outlooks in a new survey, but market basics appear to be reining in some of the industry’s post-election optimism.
The Texas Manufacturing Outlook Survey conducted by the Federal Reserve Bank of Dallas — which surveyed 115 Texas manufacturers — showed continued increases in manufacturing activity. The production index — which measures the amount of goods companies produce — increased by 4.8 points in February to 16.7. The percent of manufacturers reporting increases in production remained steady while the percent reporting decreases dropped by 4.5 percentage points.
Capacity utilization — the extent to which a company is using their plant and equipment to produce goods — increased 5.6 points to 14.7, indicating that more manufacturers are seeing higher demand to build goods.
Since Donald Trump’s election in November, manufacturers have been predicting a better business climate, with the February reading rising 2.4 points in February to 24.5 points, the best since April 2010 according to the Dallas Fed.
February marked the sixth month in a row that the company outlook indicator was in positive territory, though it dropped by 7.4 points, falling to 17.6. The Dallas Fed said the January reading of 25 points was the highest since 2010.
A fabricated metal product manufacturer said “the global economies and U.S. economy are very weak and uncertain,” while another in the computer and electronic manufacturing industry said, “The rising dollar is hurting American manufacturers.”
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