US DATA: KC Fed Manufacturing Continues To Pick Up As Price Pressures Abate
The Kansas City Fed's Tenth District Manufacturing Activity report showed the strongest activity in 36 months in September, with the headline month-over-month composite index at 4, vs 1 in the prior two months.
- The composite is calculated as the average of the production, new orders, employment, supplier delivery time, and raw materials inventory indices: all rose sequentially with the exceptions of new orders (2, after 5 prior) and supplier delivery time (4, after 7 prior), while notably employment picked up to the highest since March 2025. Expectations 6 months forward were a little softer at 7, but remains elevated vs levels seen over most of 2023-24.
- Inflationary pressures abated: current prices paid dipped to a 4-month low 40 from 43, with prices received fell to a 9-month low 13 from 21. 6-month ahead prices cooled too, with prices paid at 58 (4-month low) from 61 and received at 36 (8-month low) from 45.
- While we wouldn't read too much into the anecdotes, we noted that there was no mention of the word "tariff", in contrast to reports in most of the year - that said, most of the respondents were more downbeat and uncertain than the headline survey indices would suggest.
- We await the Dallas Fed manufacturing report on Monday before making any conclusions on national manufacturing activity in September ahead of next Wednesday's ISM Manufacturing release.
- Thus far the September results have been very mixed: the NY and Richmond Feds saw large pullbacks in current activity vs August, while Philadelphia and KC saw big improvements.
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US: Republican Concerns Over Inflation Recede
Republicans are less likely than Democrats to see inflation as a 'very serious' problem, according to a new YouGov Survey, with GOP voters registering a sharp decline in inflation concerns since August 2024.
- YouGov: “Republicans are much less likely than they were in August 2024 to see many of the problems asked about as very serious. 48% say inflation is a very serious problem, down from 89% who said this a year ago. They also are far less likely to see election fraud (33% vs. 59%) and unemployment (19% vs. 40%) as very serious problems now as they were a year ago.”
- YouGov continues: “For Democrats, it’s the opposite — they’re more likely than they were a year ago to perceive many issues as serious problems. They are more likely now than in August 2024 to describe as very serious problems inflation (71% vs. 45%), lack of public transportation (35% vs. 26%), and corruption (72% vs. 51%).”
- According to Silver Bulletin, inflation remains Trump's weakest issue with voters. Per SB's aggregated polling, Trump has a -25% net approval on inflation, compared with -15% on trade, -12% on the economy, and -3.5% on immigration.
Figure 1: “How serious of a problem do you [Republicans] think the following are in the United States? (% who say "a very serious problem)”
Source: YouGov
US: FED Reverse Repo Operation
RRP usage retreats to $28.574B this afternoon from $47.567B yesterday -- compares to $22.344B on Tuesday, Aug 19 - lowest since April 5, 2021. Total number of counterparties at 16. This year's high usage of $460.731B on June 30.
MNI EXCLUSIVE: Conference Board Senior Economist On Inflation and Jobs Outlook
MNI interviews Conference Board senior economist on inflation, jobs outlook -- On MNI Policy MainWire now, for more details please contact sales@marketnews.com
