Kansas City Fed Reports Another Month of Declining Manufacturing Activity
The manufacturing activity composite index declined -7 in July, according to the Kansas City Federal Reserve Bank. July marks the fifth straight month of decline for that sector, albeit at a slower pace than in either May (-13) or June (-9). Several measures of activity were negative, including new orders (down from -3 to -6), production (up from -21 to -5), shipments (up from -15 to -2) and exports (down from -5 to -10). On a positive note, the index for expected new orders rose from 9 to 13, the highest level in three months, leading to predictions of growth moving forward. To learn more, visit here.
Chinese Manufacturing Activity Slips Even Further in July
Chinese activity has contracted in seven of the past eight months, continuing a deceleration trend in that nation’s economy. The Caixin Flash China General Manufacturing PMI dropped to its lowest level since April 2014, from 49.4 in June to 48.2 in July, and all PMI subcomponents were in negative territory. New orders, output, exports and hiring slipped even further than last month. Employment fell at a slower pace for the month and domestic and foreign demand declined once again after stabilizing slightly in June. To learn more, visit here.
Senate Approves Two-Year Tax Extenders Package
Last week, the Senate Finance Committee approved a package to extend a variety of expired tax provisions (or tax extenders). Through the end of 2016, manufacturers can take advantage of a number of extended tax provisions, including enhanced Section 179 expensing, first year 50 percent expensing (AKA bonus depreciation), the R&D tax credit, deferral for active financing income and the look-through rule for controlled foreign corporations. To learn more, visit here.
Business Economists Note Slowing Growth in Sales in July
Sales growth activity slowed somewhat from earlier in the year, according to the National Association for Business Economics (NABE). In its latest Business Conditions Survey, respondents noted slightly weaker conditions than in prior reports, yet still remained mostly upbeat about the second half of 2015. The labor picture also remained mixed, with 41 percent of respondents foreseeing more hiring in the coming months, while also citing difficulties in attracting new talent. In terms of forecasts, 64 percent of respondents think that real GDP will grow 2.1 to 3.0 percent over the next 12 months. To learn more, visit here.