The strongest growth of the economic expansion continues apace for the Dallas manufacturing report where the general activity index held steady at a higher-than-expected 16.8 and with production growing very solidly at 15.4. Shipments, in distinction to production, are up 3 points to 9.5. New orders improved to 11.5 with employment steady at a constructive 8.5. Costs are rising but at a slightly lower rate while selling prices, in confirmation of strong demand, are showing solid traction. Wage pressures are tangible but steady. Six-month sentiment readings are solidly positive but down from post-election peaks.
Delivery times, which in last week's Empire State and Philly Fed reports showed significant delays consistent with strong activity, also slowed in this report but only marginally. Times, at 1.4 in April, compare with 10.1 and 5.8 for March and February. Still, given the strength of production and shipments, increasing delivery delays for the May report wouldn't be a big surprise. Manufacturing production at the national level stumbled in March's heavy weather but the uninterrupted gains in the regional reports, including this one which is getting a special lift from improved oil prices, are pointing to a major April rebound.