Kansas City Fed manufacturing index posts strongest growth since 2022
March data shows regional factory activity and employment rebounding into positive territory
Kansas City — Manufacturing activity across the central United States expanded at its fastest pace in nearly four years this month, according to data released by the Federal Reserve Bank of Kansas City.
The region's manufacturing composite index climbed to 11 in March, up from 5 in February, marking the highest level since July 2022.
The gains were fueled by production increases in both durable and nondurable goods, led by strong output in wood products, paper, and plastics and rubber. Shipments and new orders rose significantly, reaching index readings of 20 and 15, respectively. The employment index rebounded into positive territory, jumping to 6 from negative 7 in February, signaling that regional factories are adding jobs.
"Regional manufacturing activity rose moderately from last month, posting its highest reading since July 2022," said Cortney Cowley, assistant vice president at the Kansas City Fed. She noted that optimism for future production has also ticked up, with most firms anticipating higher demand throughout the remainder of the year, even as raw material costs continue to outpace finished goods prices.
The monthly survey tracks factory activity and future expectations across the Tenth Federal Reserve District, which encompasses Kansas, Colorado, Nebraska, Oklahoma, Wyoming, northern New Mexico and western Missouri. A reading above zero indicates expansion; a negative number signals contraction.
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