KANSAS CITY — Manufacturing activity slowed during June in the Kansas City Federal Reserve’s district, which includes western Missouri and Kansas, according to the K.C. Fed’s monthly manufacturing survey released today.
“Factories in our region reported slower growth, easing price pressures, and rising uncertainty in June,” said Chad Wilkerson, vice president of the K.C. Fed.
While pricing indexes for manufacturers in the district still showed positive growth for June, the amount of growth was lower than in previous months. The survey cited economic uncertainty and concerns about the financial crisis in Europe as weighing down producers’ expectations. Though there continue to be fears over conditions in Europe, Wilkerson said only a few firms experienced significant negative impacts so far.
The slowdown among Midwestern manufacturers reflects a slowdown in economic activity nationwide, too. The Department of Commerce released National Gross Domestic Product figures today for the year’s first quarter through its Bureau of Economic Analysis. The BEA reported goods and services made in the U.S. grew at 1.9 percent over the first quarter of 2012 compared to 3 percent in final quarter of last year.
Much of the slowdown in GDP is due to a deceleration in business spending on plants and equipment and a decrease in size of inventories—an indication that companies expect lower sales. What growth the country did experience was supported largely by personal consumption and exports.
Looking ahead to what firms in the K.C. Fed’s district anticipate for the next six months of business, indexes show producers still expect to continue growing, but at a slower pace than expected for the latter part of last year.