Dallas Fed: Texas Nov. Output Up Amid Tougher Conditions

SECAUCUS, NJ (DTN) — Texas factory activity surged in November, driven by higher manufacturing, even as industry representatives cited rising costs and tougher operating conditions, a Dallas Federal Reserve survey published on Monday (11/24) said.

The Texas Manufacturing Outlook Survey’s Production index, a barometer of manufacturing, rose 15 points from October to 20.5 this month, the survey said.

Even so, sentiment over business conditions worsened among the survey’s participants. The general business activity index sank further into negative territory to -10.4 from a prior -5. The company outlook index also worsened, falling six points to -6.3.

“There is a continued weakness in the retail consumer market,” said a representative from Texas’ fabricated metals industry. “Interest rates and inflation are certainly factors, but there is a general level of uncertainty in the consumer market that is tied to both political and economic uncertainty.”

Conversely, the raw materials prices index rose two points to 35.3, while the finished goods prices index climbed to 10.8 from 7.7.

“Small, established businesses have nowhere to turn for help when suddenly paying new tariffs. We purchase raw materials from [Asian nations] and manufacture in the U.S., only to see [those nations’] governments subsidize manufacturing,” said a transportation equipment manufacturing representative.