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Dallas Fed: Texas Manfacturing Continues to Grow—But At Slower Pace

For immediate release: August 27, 2012

DALLAS—Texas factory activity increased but at a slower pace in August, according to the Federal Reserve Bank of Dallas’ Texas Manufacturing Outlook Survey.

Texas produces more than 9 percent of total manufactured goods in the United States, ranking second behind California in factory production.

The production index—a key measure of state manufacturing conditions—fell from 12 to 6.4, suggesting softer output growth.

Positive readings in the survey generally indicate expansion of factory activity, while readings below zero generally indicate contraction.

Other indexes of current manufacturing activity also declined in August. The new orders index edged down to a reading of zero, suggesting flat demand.

The capacity utilization index fell from 8.7 to 1.7, reaching its lowest reading since April.

Indexes reflecting broader business conditions were mixed, but both increased from last month. The general business activity index remained negative but climbed nearly 12 points from -13.2 to -1.6. The company outlook index was positive for the fourth month in a row and edged up to 4.1 from a reading of 1.6 in July.

Price pressures were mixed in August. After two months of minimal increases in input costs, the raw materials price index rebounded, rising 8 points to 10.9. Selling prices fell for the sixth consecutive month in August; the finished goods price index was -1.6, up from -5.5 last month.

The Dallas Fed conducts the Texas Manufacturing Outlook Survey monthly to obtain a timely assessment of the state’s factory activity.


Media contact:
James Hoard
Federal Reserve Bank of Dallas
Phone: (214) 922-5307