Buffalo Niagara manufacturers are off to a hot start in 2017.
With production ramping up and new orders pouring in at a brisk pace, the region's manufacturers opened 2017 with their strongest monthly growth in two years, a new survey of local purchasing managers found.
The January gain was further evidence of a turnaround at local manufacturers, reversing a seven-month slide that began in February and stretched through August. The improvement extended the growth streak by local manufacturers to a fourth consecutive month and it coincided with a rebound in the statewide Empire State Manufacturing Survey, which has shown improvement for the past three months.
"It was a rather favorable month," said Jay K. Walker, the Niagara University economist who tracks local manufacturing activity for the Institute of Supply Management – Buffalo.
While Walker said it still is unclear whether President Trump might roll back free trade agreements in a move that would hurt exports and drive up prices, he also noted that the overall economy has been showing strength.
"Concerns over Trump limiting trade haven’t seemed to crept in with our local respondents," Walker said.
The latest survey of local purchasing managers showed that business among local manufacturers grew at its fastest pace last month since January 2015, with the group’s business activity index jumping to 69.9 from 58.9 in December. Any time the index drops below 50, it’s a sign that the manufacturing economy is weakening, while it's a sign of growth when it tops 50.
The January improvement was broad-based, with production rising sharply for the third straight month and the flow of new orders increasing for the fifth consecutive month. The pace of hiring improved for the fifth straight month and hit a two-month high.
On the downside, commodity prices jumped, while inventories shrunk for the 17th time in the last 18 months.