Courtesy of Karl Denninger, The Market Ticker
Responses from manufacturing firms polled for this month’s Business Outlook Survey suggest that regional manufacturing activity continued to expand in February. The survey’s broad indicators for general activity, new orders, and shipments all increased from their readings in January. Firms reported near]steady employment levels but an increase in average work hours. More firms reported higher input prices this month, and a sizable share of firms reported price increases for their own manufactured goods. The survey’s broad indicators of future activity fell from levels in recent months but continue to reflect optimism about future manufacturing growth.
And the internals support this.
The one problem I see in the internals is here:
Prices paid/received continued to widen, and employers are not hiring — they're adding hours.
Many will say that hour adds are a precursor to hiring but in this case hours went up but hiring activity did not, and that's a reversal from previous trends.
It's not the absolute, it's the trend change, and it's a bit troubling, marring what would otherwise be quite good overall.
We'll see what next month holds.
