Dallas Fed Manufacturing Report Remains Robust

Activity, at 21.8 for April, remains robust in the Dallas Fed manufacturing sector as does production at 25.3. Orders for this sample have risen sharply this month coming against, however, signs of stress with capacity utilization jumping nearly 8 points to 18.7 and with input prices up more than 3 points to a 7-year high at 46.3. Tariff effects are hard to isolate but confidence in the general outlook, at 31.9, remains about 10 points lower then before the tariffs hit. Overheating is the risk in this report as it is in other regional Fed reports most of which are pointing to strong acceleration for the nation's factory sector. Note that today's report includes annual revisions to prior data.