The economic outlook for manufacturing industries was very promising through August, as producers saw demand for durable goods running at "vigorous" levels, according to the Federal Reserve Bank's monthly "Beige Book" report.
The Federal Reserve Bank compiles its report from reports on manufacturing activity in each of its 12 districts.
"Activity indicated significant gains across most districts during June and July. The only slightly weak reports came from New York, where manufacturers reported decelerating activity in July in the wake of a strong June, and St. Louis, where manufacturing conditions were mixed," the most recent report said.
Among products, demand was especially vigorous for various durable goods, and substantial sales gains were reported for makers of electrical equipment and information technology products such as semiconductors, along with further increases in orders and activity for makers of commercial aircraft and products used for national defense.
The district reports pointed to further increases in demand for makers of heavy equipment, machine tools, and steel, but those gains were partially offset by reduced demand for smaller equipment oriented towards residential construction activity.
The report said demand for building materials was mixed but positive, and noted that the Atlanta district reported a drop in demand for concrete, while the Chicago district reported strong demand for wallboard, and the Richmond and Minneapolis districts saw increases in the production of fabricated metals.
The Cleveland, Chicago, and San Francisco districts noted that capacity utilization was high in various manufacturing sectors, and increased in general.
In a look ahead, manufacturers in the Boston, Philadelphia, and Cleveland districts said they had plans to increase their capital spending over the balance of the year, while expectations for future capital spending remained low in the Kansas City District.
